Around £50 billion of public money a year is spent to support people with disabilities and health conditions. Spending on disability benefits has risen by over £3 billion in real terms since 2010, and will remain higher in each year to 2020 than in 2010. PIP is an important part of this. It has been designed to focus more support on people who have higher costs associated with their condition.
Entitlement is not based on what condition a person has, but on how their condition affects their ability to live an independent life.
Recent legal judgments have interpreted the assessment criteria for PIP in ways which are different from what was originally intended when the Coalition Government introduced the system. For example, one ruling held that needing support to take medication and monitor a health condition should be scored in the same way as support to manage therapy, such as dialysis, which takes place in the home. A second ruling held that a person who cannot make a journey without assistance because of psychological distress should be scored in the same way as a person whose need for assistance results from difficulties in navigating, for example if they are blind. The Government says it is clarifying the criteria to ensure PIP maintains its original policy objectives and support continues to be focused on those most in need.
I am told this will not result in any claimants seeing a reduction in the amount of PIP previously awarded by the Department for Work and Pensions, and the intention is not to make any new savings. These amendments are solely intended to reiterate the original policy intent following legal judgments in which the Tribunals commented that the existing regulations were not completely clear.
PIP has been designed to better reflect our modern understanding of disability, including giving mental health conditions the same recognition as physical ones. Over two thirds of PIP recipients with a mental health condition receive the enhanced daily living component, compared with 22 per cent who used to receive the higher rate under Disability Living Allowance. I have been assured that PIP claimants with mental health conditions will continue to be properly supported after these amendments have been made. The changes are simply about ensuring that the assessment criteria properly reflect the barriers to independence a claimant faces, and the costs they might incur as a result.
Disability Living Allowance (DLA) was an outdated, complex benefit introduced over 20 years ago which does not reflect today's understanding of disability. Most people who claim DLA have conditions that change over time, yet 71 per cent of people were receiving DLA for life without any inbuilt systematic reviews. This led to hundreds of millions of pounds in overpayments and underpayments.
The aim of Personal Independence Payment (PIP) is to ensure support is focused on those with the greatest barrier to independence. The assessment of eligibility focuses on an individual's ability to carry out key everyday activities and will be easier to understand and administer.
PIP involves a more objective assessment, including a face-to-face consultation, to help target support at those who need it most.