Britain’s welfare system faces an unprecedented challenge as projections indicate health-related claims will constitute 50% of all primary benefit applications by 2029, with annual costs surpassing £100 billion for the first time in history.
The Office for Budget Responsibility (OBR) reports that the post-Covid surge in health-related claims is becoming a permanent fixture, reflecting a broader decline in the nation’s health. This alarming trend sets Britain apart from other developed nations, which have generally seen post-pandemic improvements.
Mental health claims have emerged as a significant driver, particularly among younger demographics. The data reveals that 37% of new disability benefit awards are primarily for mental health conditions, marking a substantial increase from 28% pre-Covid. The under-40 age group has witnessed a staggering 150% rise in claims.
Work and Pensions Secretary Liz Kendall characterises this situation as “unacceptable,” attributing it to “the appalling legacy of the Conservative government.” The current administration has pledged £240 million to pilot localised approaches integrating work, health, and skills support.
The Institute for Fiscal Studies (IFS) highlights this trend as a key factor in Britain’s increased taxation without corresponding improvements in public services. Carl Emmerson, IFS Deputy Director, emphasises the urgent need for careful examination of support mechanisms and appropriate use of taxpayer money.
The combined cost of disability and incapacity benefits, which stood at £64.7 billion in 2023-24, is projected to reach £100.7 billion by 2029-30, more than doubling the £40 billion expenditure recorded in 2018-19. This escalation presents a critical challenge for the government’s fiscal planning and welfare reform initiatives.
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