Source · Select Committees · Public Accounts Committee
Recommendation 26
26
Accepted
Underpayment rates for disability benefits remain highest, often due to unreported worsening conditions.
Conclusion
Underpayment rates are highest for disability benefits. In 2023–24, the unfulfilled eligibility rate for Disability Living Allowance was 11.1% (£750 million) and for Personal Independence Payment was 4.0% (£870 million). The most common reason for underpayments is customers failing to inform DWP that their condition has worsened or their needs have increased, 48 C&AG’s Report (on accounts), para 4; C&AG’s Report, An Overview of the Department for Work & Pensions for the new Parliament 2023–24, October 2024, page 22 49 C&AG’s Report (on accounts), para 21 50 C&AG’s Report (on accounts), para 14 51 C&AG’s Report (on accounts), para 21 14 meaning they would have been entitled to more financial support.52 These underpayments leave the claimants affected with less money than they should have, increasing the risk of them facing financial hardship.53
Government Response Summary
The government agrees with the committee's point, stating it will introduce a safeguarding approach and, in the longer term, implement the Health Transformation Programme. This program will transform the PIP service by introducing an optional online service to help rebuild trust and make it easier for customers to report changes of circumstances.
Government Response
Accepted
HM Government
Accepted
5.1 The government agrees with the Committee’s recommendation. Recommendation implemented 5.2 According to the latest national statistics, "underpayments” in the benefit system represent a small percentage of total benefit expenditure. The total rate of benefit expenditure underpaid in the financial year ending 2024 was 0.4% (£1.1billion), compared with 0.5% (£1.2billion) in the previous year. 5.3 The causes of unfulfilled eligibility are many and complex but trust in the department lies at the heart of the issue. Disability benefit customers have concerns that reporting changes will lead to reduction in entitlement, so many choose not to. There are also some who simply don’t recognise their needs have changed because their condition worsens slowly over a long period of time. Tackling the issue is not just a matter for the department. Wider discourse about disability benefits is bound to have an impact on perceptions which might drive increases in unfulfilled eligibility, making progress difficult. The department will continue to challenge misconceptions of its service and build trust, starting with the commitment to introduce a safeguarding approach. 5.4 Over the longer term, the department plans to deliver significant service modernisation through the implementation of the Health Transformation Programme, which will improve the experience of customers and help to rebuild trust in the department and confidence for customers reporting changes. The Programme will also make it easier for customers to provide updates. It is transforming the entire PIP service, including introducing an optional online service, which will eventually enable customers to apply, track and monitor their claim and inform the department of changes of circumstances.