The budget has a range of benefits related measures, including VAT on Motability top-ups, an additional 122,000 Work Capability Assessments for existing claimants, benefits uprating at 3.8% and the ending of the two child limit.

Motability

VAT relief for top-up payments made to lease more expensive vehicles will be removed for new leases from July 2026, so VAT will be payable at 20% on top-ups.

Insurance Premium Tax will apply at the standard rate of 12% to insurance contracts on the Scheme.

These tax changes will not apply to vehicles designed for, or substantially and permanently adapted for, wheelchair or stretcher users.

Motability will remove luxury vehicles from the scheme, discontinue the inclusion of overseas breakdown cover and reduce their lease mileage limit. The government say that this will bring Motability leases more in line with those available commercially to most people.

Together, these measures are expected to save just over £1bn by 2030.

Benefits uprating

Working age benefits will be uprated in line with the September CPI inflation of 3.8% from April 2026.

Rates for the Universal Credit Standard Allowance and Health Element remain set in legislation until April 2029.

Assessments

The DWP will conduct an additional 122,000 Work Capability Assessments for existing claimants by 2029-30 to ensure people are receiving the right level of support.

They are also extending Personal Independence Payment award reviews periods and increasing face-to-face health assessments.

Together, these measures are expected to save £1.95bn by 2030.

Two-child limit

The two-child limit in the Universal Credit Child Element will be removed from April 2026.

It is estimated that there will be 600,000 fewer individuals in relative low income after housing costs in 2030 as a result. This includes 450,000 children and 150,000 working age individuals.

It is also estimated that by 2030, two million children will live in households that see an increase in income as a result of the removal of the two-child limit within Universal Credit.

Fraud and error

The government will extend Targeted Case Review that identifies incorrect Universal Credit claims to 2031, saving an additional 1.3 billion.

Prescription charges

NHS prescription charges in England will be frozen in 2026-27 with the cost of a single prescription remaining at £9.90.

Minimum wage

From 1 April 2026, the National Living Wage will increase by 4.1% to £12.71 per hour.

The National Minimum Wage for 18-20 year olds will also increase by 8.5% to £10.85 per hour and for 16-17 year olds and apprentices by 6.0% to £8.00 per hour.

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  • Thank you for your comment. Comments are moderated before being published.
    · 1 days ago
    By freezing tax thresholds Labour will lead to many low paid workers having to pay tax plus it will lead hundreds of thousands of workers being dragged into the 40% higher tax bracket by 2030.
    There was no consultation with disability groups over the changes to motability. Reeves caved into right wing media propaganda.
    The budget was based on fantasy economic projections from the OBR, which is notoriously inaccurate with its forecasts for growth.
    Unemployment is rapidly rising in the UK as the economy slows at the same time as the global economy is slowing down. The UK has been hit and will continue to be hit by Trump's tariffs.
    It is clear that before the next election the government will be forced to make major cuts to public spending with benefits bound to be in the forefront of such cuts.
    Never mind the cuts which are coming to UC next March and the abolition of contribution based ESA and the continuing cuts to access to work. The  Timms review of PIP is still not being co-produced and they will try to use it as a trojan horse to make future cuts.
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      · 1 days ago
      @bronc On the bright side if the Ukraine war ends that could result in falling energy and food prices. 
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    · 2 days ago
    Assessments

    The DWP will conduct an additional 122,000 Work Capability Assessments for existing claimants by 2029-30 to ensure people are receiving the right level of support.

    They are also extending Personal Independence Payment award reviews periods and increasing face-to-face health assessments.

    Together, these measures are expected to save £1.95bn by 2030

    What a B L O O D Y idiot Labour lied again!
  • Thank you for your comment. Comments are moderated before being published.
    · 2 days ago
    I've been on lcwra since 2020 for which I had a face to face assessment and luckily it was all sorted just before covid and the lock downs kicked in. Even though obviously I have little money for luxuries I'm happy but now with all this talk of reassessments I just feel like I'm sat on death row waiting for my turn. Let's face it if the objective is to save money any reassessments will shall we say be biased into finding you fit for work and tripping you up at any opportunity. I'm 53 and actually wish I was ten years older then I'd no doubt escape this game of russian roulette with the DWP.
    • Thank you for your comment. Comments are moderated before being published.
      · 2 days ago
      @CJA I know that feeling I'm 52 and am wondering when the axe will fall on me. I'm on one of those auto renewing fit notes so don't know where that leaves me.
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      · 2 days ago
      @CJA @CJA This is the sad thing - it makes us wish our lives away. Don't do that, take what you can from here and now. Hard I know, but it's the best we can do. Keep up with getting copies of your medical records and make a diary of your health if you can, so as to be best prepared if you are reassessed You did it before, you can do it again.
  • Thank you for your comment. Comments are moderated before being published.
    · 3 days ago
    Is it 2028,2029 or 2030 that they intend to abolish LCWRA? And will it be for new claimants first then existing ones at a later date? ( hopefully much, much later)
    • Thank you for your comment. Comments are moderated before being published.
      · 2 hours ago
      @tintack We disagree on the political reality and time will tell who is correct.
      I am defeatist in the that I think Labour MPs will fear being portrayed as the party for welfare and not having the welfare savings to use for tax giveaways and freebies come election time, more than they will fear losing the votes of those whose welfare they cut. Especially if they have the political cover of claiming the cuts were co produced or based on expert evidence, and for the good, making welfare sustainable for the future, and helping people back to work.

      I am also prone to tell myself my household will be safe. I remind myself of the guy in the Waterworld movie going on about how we will be safe behind these walls. I think people with ongoing enhanced rate daily living PIP awards will be safe. That they will carry on getting UC health element, and getting PIP and will probably be passported into the severe conditions criteria group, and will somehow avoid the support conversations. Which I tell myself could be just after PIP awards and reassessments so never. And tell myself in the meantime they will not get around to doing WCA reassessments, or if they do it will be OK. Telling myself all will be OK is the only way to really cope with the endlessly moving goal posts of our ever changing welfare "safety net" which seems to get more holes in it to fall through every year.

      What probably does not reflect well on my character is that I do tell myself that other people, not my household will be affected by the cuts I defeatistly think are coming. So I say it will be the young, it will be the new claimants, it will be those not on PIP, it will be those on PIP fixed term awards that are reassessed, it will be anyone but my household. I will be safe, we will be safe behind these walls. 
    • Thank you for your comment. Comments are moderated before being published.
      · 2 days ago
      @John
      "So I think it is wishful thinking that the government will retain LCWRA for those who fail to meet eligibility for PIP daily living component, when the WCA is abolished and along with it LCW and LCWRA and replaced by the new system of UC health element and UC severe conditions criteria element and a new system where everyone (probably not including those in the severe conditions criteria) is expected to engage with the DWP at least as far as support conversation"

      As I said, I'm sure they won't want to leave existing claimants out of this change (if it happens). But the number of people who would be plunged into poverty if they don't is so huge - far bigger than the number who were forecast to be pushed into poverty by the cuts they were trying to get through this summer, which provoked such a backlash on their backbenches - that a repeat of this summer's rebellion would be virtually inevitable, and that is politically unsustainable for them. I'm sure they didn't want to back down to the extent that they did this summer, and it might well have seemed like wishful thinking to imagine that they would. Nevertheless, they had to. Political reality left them no choice.

      There must also be a question about how a new system of UC Health and UC Severe Conditions criteria could possibly work if the WCA abolition happens. The SCG criteria are based on satisfying a WCA descriptor. If the WCA doesn't exist, what would the SCG criteria be then? They can't be anything from the PIP assessment as that is not an incapacity for work test and therefore has no equivalent of LCWRA descriptors.


    • Thank you for your comment. Comments are moderated before being published.
      · 2 days ago
      @tintack
      "They had to agree not to cut LCWRA for existing claimants in the summer - they would have lost that vote otherwise."

      The original Universal Credit and Personal Independence Bill exempted existing pre 2026 LCWRA claimants from the reduction in LCWRA for new claimants. That was not something they were forced to agree to, it is something that was there from the start.

      In the original bill the LCWRA element was also frozen for all but with the UC personal allowance increasing more than inflation. A minor concession they were forced to agree to was that for pre 2026 claimants and for those in the severe conditions criteria their UC personal allowance + LCWRA combined would increase by inflation. Although this maybe done by increasing the UC personal allowance element by more than inflation and the LCWRA element by less than inflation.

      When a premium is reduced it is normal for at least transitional protection to be given for existing recipients. The government did more than that. But that maybe because the premium is being abolished and replaced in the near future.

      When a benefit is abolished and replaced it is no longer the norm for it to be retained for existing claimants.

      The government did not retain DLA for existing claimants who failed to meet eligibility criteria for PIP. Even when those DLA awards were lifetime awards.
      Nor retain Incapacity Benefit, Severe Disablement Allowance (which was supposed to be for life) or Income Support on Grounds of Disability for existing claimants who failed to meet the eligibility criteria for Employment Support Allowance.
      Nor is the government retaining Income Based ESA for those who fail to make the transition to UC.

      So I think it is wishful thinking that the government will retain LCWRA for those who fail to meet eligibility for PIP daily living component, when the WCA is abolished and along with it LCW and LCWRA and replaced by the new system of UC health element and UC severe conditions criteria element and a new system where everyone (probably not including those in the severe conditions criteria) is expected to engage with the DWP at least as far as support conversations.

      What we do not know is how the PIP assessment system will be changed in the meantime by the Timms Review. Which is likely to reduce eligibility further. Making the number of people on LCWRA who will not get PIP daily living even bigger than 600,000. This is intended to save the government a lot of money. And demonstrate they are tough on welfare. And utterly change the welfare system, from one they claim has perverse incentives to be incapable of work and abandons people to a lifetime on benefits. It along with tackling immigration is how Labour hope to win in 2029 by basically being like the Tories and Reform. 
    • Thank you for your comment. Comments are moderated before being published.
      · 2 days ago
      @Neil
      "And will it be for new claimants first then existing ones at a later date? ( hopefully much, much later)"

      Hi Neil. A Benefits and Work article from July says this:

      "The LCWRA element of UC will be replaced for new claimants from April 2026 by the UC health element.

      Then, from 2028/29, the WCA will be axed and eligibility for the UC health element will depend upon being in receipt of the daily living component of PIP.

      There is currently no certainty about whether current LCWRA claimants who do not receive PIP daily living will be affected by the change."

      So, as that last sentence makes clear, we don't even know if this will be applied to existing claimants at all. They had to agree not to cut LCWRA for existing claimants in the summer - they would have lost that vote otherwise. As I've said before, if they try to apply this change to existing claimants, that will mean pushing 600,000 of us currently on LCWRA who don't get PIP daily living into poverty - and that would start to bite in the run-up to the next election. Given the rebellion this summer over something which was forecast to push 250,000 people into poverty, if they then come back with something that would push 600,000 into poverty it seems almost inevitable that there would be a repeat of that rebellion. They simply cannot afford that. This summer's rebellion was politicaly toxic (they still haven't recovered from it, in fact the leadership's authority has been further decimated even compared to how it was then) and it seems to have thrown their plans for sickness and disability benefits into confusion. A repeat of that rebellion would not just be politically toxic: at this point it would be politically fatal.
    • Thank you for your comment. Comments are moderated before being published.
      · 2 days ago
      @Neil It is only indicative because it is dependent on Parliament passing legislation to even happen. It maybe delayed as any changes to the PIP assessment system already have been delayed from 2026/27 to probably 2027/28 because Parliament would not agree to it. And after the May 2026 local elections it is even possible Starmer could be ousted as Labour leader. Then who knows.

      If it goes ahead I expect they would want to complete the Pathways to Work plan including abolishing the WCA by 2028/29 or 2029/30 at the latest as they will want to look tough on welfare for the next general election 15th August 2029 or earlier. How long the changes would take to implement is another matter, will it be instant or will it take over twelve years like the still not fully completed move to PIP and to UC. 
  • Thank you for your comment. Comments are moderated before being published.
    · 3 days ago
    The mobility scheme changes are politics of envy pushed by mainstream media who do not tell the public a Mercedes or a Vauxhall Corsa the payment for the car is £77 a week. They made out the full cost of a Mercedes is met by the tax payer when it is the same £77 a week for all cars. We are all tax payers. 

    Then we have the mainstream media pushing another lie that people believe that PIP is a out of work benefit. They make the public believe all PIP claimants claim UC and other benefits.

    I suspect the mainstream media are briefed by No.10. To push these narratives against disabled people. 
  • Thank you for your comment. Comments are moderated before being published.
    · 3 days ago
    Would anyone else mind going without the £10 Xmas bonus as a way to slash the welfare spend? I happily would if it meant we’d stop being demonised - it would be a small price to pay. 
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      · 1 days ago
      @D You are absolutely right, bang on, that is the reality and practical consequence of the situation. 
    • Thank you for your comment. Comments are moderated before being published.
      · 2 days ago
      @Anon N I suggested that a year - got absolutely hammered by online disability community for even suggesting it.

      I’m also a bit miffed at the anger of some of new high end BMWs/Mercedes being taken off the mobility scheme - why would any disabled want to make targets of themselves

      Several of the public hate the disabled right now as we are stereotyped for getting truckloads of welfare for sitting on our backsides - a lot of ppl are clueless to true reality but why anger the mob unnecessarily by leaning into the stereotype.

      It would of been hard but it may of been better for us is there’d been a benefit freeze in the budget - the removal of the 2 child cap is just going to intensify verbal attacks on claimants (esp disabled as we are all stereotyped to be on welfare) so by the time the timms review is complete and the gov goes for pip reforms/cuts take 2 the public are foaming to take a bite from us and see us ‘punished’

      The removal of the 2 child cap was solely about buying starmer and co time till at least the local elections and also a bribe to Labour backbenchers to look the other way with disability reform/cuts take 2 - I fear disabled claimants will pay heavily with the next 12 months as a consequence 
    • Thank you for your comment. Comments are moderated before being published.
      · 3 days ago
      @James h As Fletcher once said in Porridge James,Dont let the bastards drive you down.
    • Thank you for your comment. Comments are moderated before being published.
      · 3 days ago
      @Sara I know the feeling I went for my lcw interview today at the job centre from the moment I walked in was treated like scum by the security belittled by the receptionist talked down to by my work coach I left feeling very mentally poorly luckily I’m getting close to my wca for lcwra my mental health has gotten worse and had a diagnosis for autism hopefully early next year should be seen just need some breathing space from all this I migrated to uc from esa in February been a nightmare all year it has 
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      · 3 days ago
      @Anon N Sadly this won’t stop politicians and the general public demonising us! The £10 bonus doesn’t buy much these days anyway, a meal for two at McDonalds!
  • Thank you for your comment. Comments are moderated before being published.
    · 3 days ago
    Hi everyone, I'm still receiving DLA (indefinitely) & have not been asked to change over to PIP, is there anyone else in this situation? I receive Universal Credit, but im concerned that if i don't receive PIP, then I will lose the health element of Universal Credit. There’s not much been said about it & i hoped that there might of been some news in the budget, or do I have to wait for the Timms report? Any information would be greatly appreciated. Thanks in advance.
    • Thank you for your comment. Comments are moderated before being published.
      · 2 days ago
      @Coleen Thanks for the advice re failure rate. Very interesting. 
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      · 2 days ago
      @Coleen I absolutely intend to, also got a cab adviser who will likely be helping me with the tribunal part of it too, hopefully that is
    • Thank you for your comment. Comments are moderated before being published.
      · 3 days ago
      @Coleen I'm on mandatory reconsideration right now, they said it could take up to 15 weeks
    • Thank you for your comment. Comments are moderated before being published.
      · 3 days ago
      @Catriona Since the Pathways to Work plan was first announced, Timms in written answers to MPs and in meetings with MPs has repeatedly made a distinction between fixed date awards which are reassessed and ongoing/indefinite awards that have no end date. And stated that those with ongoing/indefinite awards would not be affected by changes in the PIP assessment system. As they are not routinely reassessed just light touch reviewed every 10 years. Which according to Timms is primarily done to check they are still alive and the contact details the DWP has for them are correct. As this has been the position from the start and Timms is in charge of the Timms review it can be expected to remain the case.

      Also as part of the Pathways to Work plan communication with claimants when they are given ongoing/indefinite PIP awards or have light touch reviews is supposed to be being improved. To reduce worry or stress about their PIP award. These awards are for those expected to be on PIP for life.

      Much latter when the Universal Credit and Personal Independence Bill was having great difficulty getting through Parliament an exemption was offered for all existing PIP claimants. That as long as they received PIP they would always be reassed using the current system not the then planned 4 point PIP rule. However then the PIP changes were removed from the Bill. And any PIP changes delayed until the Timms review reports. Since then the government has said Timms review changes to the PIP assessment system will apply to existing claimants when they are reassed.  
    • Thank you for your comment. Comments are moderated before being published.
      · 3 days ago
      @John John can you direct me to where it says ongoing awards wont be affected please as this is worrying me thnak you. 
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    · 4 days ago
    Do we know if the idea / plan to change ESA to unemployment insurance is intended to affect current claimants, or new claimants only?
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      · 3 days ago
      @HL Is this definitely happening? Or just being looked at?
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    · 4 days ago
    So where goes it leave the likes of the over 50s then compared to what they 'say' they intend.....I am 52 btw
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    · 4 days ago
    Media (guardian) reported recently that the fraud crackdown and not ruling out benefit cuts will be used to fund the 2 child benefit cap. There's going to be a lot more of this, media and the government going after disabled people, wanting to find savings from the PIP & Youth NEETs reviews. 
    Local housing allowance still frozen, they haven't got rid of the household cap :(
    They could have taxed extreme wealth, that would have easily funded all of it, instead of attacking motability cars, making sanctions and the benefit system harder, more reassessments, punishing disabled people. We are being treated like scapegoats and of course the tories and reform are all out blaming increased taxes on welfare 🤦‍♀️
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      · 3 days ago
      @Catherine Now Starmer has watered down workers rights to keep his big business and super rich mates happy. Business as usual!
      So even if you were able to work, as sick and disabled people, there will be less security and adaptions available.
      Taxing pensioners affects their standard of living too. But mansion tax is deferred to 2028! Those poor little rich people are so vulnerable.
      Lifting the two child cap is great news but if Reeves is cutting public services instead of taxing the rich to pay for it then that's going to affect all of us including families in receipt of the new benefit changes.
      The Your Party conference is this weekend. Let's hope there's a productive outcome.
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      · 3 days ago
      @Catherine Yeah I've been hearing it in my own family, "we are being taxed more so scroungers can sit around doing sod all" of course they don't mean  me they say quickly.... 
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      · 4 days ago
      @Catherine You’re so right Catherine. This coverts so disappointing and weak. It’s just Reform/conservative by proxy ☹️
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      · 4 days ago
      @Catherine Labour certainly does not appear to be honouring it's Manifesto "Labour is committed to championing the rights of disabled people and to the principle of working with them, so that their views and voices will be at the heart of all we do."
      Considering the Labour government seems to spend alot of their time scapegoating, smearing and demonising the disabled.  
  • Thank you for your comment. Comments are moderated before being published.
    · 4 days ago
    Thanks for the summary. It really helps with this confusing budget.
    Usually chancellors have one key highlight but this budget has been such a mess with all the briefings beforehand.
    The OBR stabbed Reeves in the front. Maybe that was some kind of revenge. A bit like the nasty leadership challenge recently aiming to discredit robotic "I'm a faithful" Streeting (not difficult with all the NHS privatisation).
    The Left needs to get it's act together. I really hope the Your Party conference goes well this weekend. The Canary has had some positive reports of local Your Party meetings. The grassroots are blossoming. It's the cranky lot at the top who can't stop trying to control everything. The Greens are showing the way though.
  • Thank you for your comment. Comments are moderated before being published.
    · 4 days ago
    A budget that is designed for elections in 2030 and one in which Labour are going to be kicked out in favour of the Greens, LibDems, and Yourparty! Lets hope labour wake up to what they have done and get rid of Stammerer and Co
    • Thank you for your comment. Comments are moderated before being published.
      · 4 days ago
      @alzon I have faith that people will vote tactically to stop Reform.
      And if a week is a long time in politics, the next general election is a in the distant future. 
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      · 4 days ago
      @James a nice thought, the reality, reform will win and we are treated like animals. 

      first past the post means the right is far less split than the non right. 
  • Thank you for your comment. Comments are moderated before being published.
    · 4 days ago
    It's disgusting that they've frozen our money until 2029 - EVERYTHING is going up in price!  Rent, bills, food, fuel etc.  I feel sick with worry, what can we do?
    • Thank you for your comment. Comments are moderated before being published.
      · 3 days ago
      @Ala ESA migration won’t lose money. I had 5 high court cases to make sure that no money was lost. You have now got 2 add on monthly payments to top up UC to the same rate as ESA. 
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      · 4 days ago
      @Alex Don't forget people on the ESA migration will lose houndreds every month!   Despite, the promiss, the cuts will only apply to new claimants!
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    · 4 days ago
    So WCA reassessments are back on? 
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      · 4 days ago
      @Ali By the looks of it the wca is staying, no doubt they'll probably do lots of changes to the wca and make it more difficult if it's staying. They lie and talk so much rubbish and there's constantly contradiction in everything they say..   
       When the horrendous reform get in, we are doomed if Labour don't get their act together.
  • Thank you for your comment. Comments are moderated before being published.
    · 4 days ago
    Nothing to shout about they say they will be increasing work capable face to face assessments by 2029-30 to existing claimants. What group are they targeting for this. having said before that people in the LCWRA group who's condition is unlikely to change won't be re assessed. And extending pip awards who are due to be assessed. There's already a huge backlog for re assessments can't see that getting better by then. This government needs to go. Or get a new leader who knows what they are doing. 
    • Thank you for your comment. Comments are moderated before being published.
      · 4 days ago
      @Ali Who knows with this Government. 
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      · 4 days ago
      @Nash Indeed. Is the 122,000 figure the amount of existing claimants waiting for a WCA right now? 

      I was told that the priority for WCA's were new claimants and people reporting a change of circumstances. I. E. People trying to move from LCW to LCWRA and that very few WCA'S were being conducted for existing claimants. 

      Is the Government virtually saying here that the backlog won't be cleared to 2029/30? 
    • Thank you for your comment. Comments are moderated before being published.
      · 4 days ago
      @Nash Are WCA reassessments switched back on? Or is it for people whose health has worsened? Thank you 
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    · 4 days ago
    So if they are going to conduct 122,000 wca assessments by 2030 how does that happen when the wca is suppose to finish in 2028?
    • Thank you for your comment. Comments are moderated before being published.
      · 4 days ago
      @Chicken dipper Which tends to suggest that they are admittimg that the WCA won't be abolished in 2028. Or is this another cock up? 
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    · 4 days ago
    Longer PIP awards so people are less often reassessed when they are unlikely to have improved is good news.

    As is UC help to save being extended to those getting UC carer element or child element, although it is not until 2028.

    More work capability assessments and making more WCA and PIP assessments face to face seems cruel, if it is not needed. Especially as they want to target those awarded LCWRA due to substantial risk of harm.

    The work guarantee for young people unemployed for 18 months or more. It turns out is 25hr weeks at minimum wage paid by the government not the employer. So free labour.

    Then there is the bad news on Motability which amounts to increasing costs so in effect a disability benefit cut by other means. 
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      · 3 days ago
      @Gabby Yes it looks like a repeat of the Coalition government when the LibDems sought to proclaim how nice they were as they protected the children, while giving the disabled a kicking. 
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      · 3 days ago
      @John Where is the money for that coming from? Benefits cuts elsewhere apparently. Give with the one hand take with the other. 
    • Thank you for your comment. Comments are moderated before being published.
      · 4 days ago
      @John But, the big news is the end of the two child benefit cap. Which is good news as the cap is a major cause of child poverty. 

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