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First published:
02/07/2025

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How the Government's 2025 Welfare Reform Bill affects you

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Yesterday, July 1st, 2025, the Government held a vote on the proposed Welfare Reform Bill. Despite concessions to the original bill, some benefits will still see changes.  

Is Personal Independence Payment (PIP) affected by the Welfare Reform Bill?

One of the most concerning elements — the changes to Personal Independence Payment (PIP) — has fortunately been removed at the last minute. This means the stricter criteria that had been suggested for qualifying for the daily living component of PIP will not be bought into law.

While this is a temporary relief, the Government has announced a review of PIP, so eligibility rules will remain unchanged until that review is completed. This review will not be published until the end of 2026, and does not guarantee those recommendations will be passed.

We know the lifeline PIP can offer people with mental health problems, and we hear frequently from our clients the difference PIP can make in their lives, so this is welcome news.

What are the changes to Universal Credit? 

Whilst the changes to PIP are not happening at present, the Bill did pass the vote, meaning there will be changes to Universal Credit next year. These changes include:  

  • From April 2026, new claimants of Universal Credit who are not fit to work will only be eligible for a health element of £50 per week (half of the current amount)
  • People under 22 will not be eligible for the health element of Universal Credit  
  • The basic rate of Universal Credit will be rising for everyone, from around £92 a week to £106 a week by 2030  

These changes are still incredibly concerning, meaning many people who are not fit to work will be worse off.

If you are concerned about any of these changes, you aren’t alone  

Please reach out for support from your trusted network of friends, family, and/or colleagues. The following Mental Health & Money Advice pages may help if you are worried about how changes may affect your finances:

Additionally, here are some useful contacts you could also approach to ask about the impact of the changes:   

Citizens Advice 

Advice NI (Northern Ireland) 

Advice NI is an Independent Advice Network offering help on money matters and benefits. You can contact them on 0800 915 4604, or by emailing advice@adviceni.net. Face-to-face advice is also available via theiir website.  

Advice.scot (Scotland) 

Advice.scot is a Scottish-based advice service for those who need it. They offer live chat, email, and telephone contact details on their website here.  

Advicelink Cymru (Wales) 

Funded by Welsh Government, Advicelink Cymru provides advice and support on social welfare rights to people in Wales, including welfare benefits, debt, employment, housing, education and discrimination. You can contact their helpline on 0800 702 2020. 

Are Carers Allowance and other passported benefits changing?

It appears that Carers Allowance and other passported benefits are protected from cuts for now. 

How the proposed changes affect people in Scotland and Northern Ireland 

How the proposed changes affect Scotland 

Scotland’s devolved social security system means there will differences in how the government handles the proposed changes. In Scotland, Personal Independence Payment is currently being replaced by Adult Disability Payment (ADP), with 99% of PIP cases already been transferred to the new system. The Scottish government has said there will be no cuts to ADP, meaning the 2026 changes will not affect claimants in the region. While Social Justice Secretary Shirley-Anne Somerville has said the Scottish government will not follow Labour’s lead on other changes to benefits, it appears that the Universal Credit changes will apply in Scotland alongside the rest of the UK.  

How the proposed changes affect Northern Ireland 

With the devolution of the benefits system in Northern Ireland, we don’t yet know the details of how these changes will affect people in the region. However, as the Stormont administration tends to copy what is happening in England and Wales, it is likely to be similar. Communities Minister Gordon Lyons has said that the Northern Ireland Executive does not have the resources to mitigate Labour’s plans.

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