The Department for Work and Pensions (DWP) has announced a potential shake-up to Personal Independence Payments (PIP) which could see direct cash payments scrapped in favor of alternatives such as vouchers.
Proposals have been put forward to overhaul the existing framework as part of his Modernizing Support for Independent Living: The Health and Disability Green Paper. PIP recipients are offered eight different payment options, BirminghamLive reports.
Under proposed reforms aimed at curbing escalating PIP spending, recipients could receive vouchers, grants and access to shopping catalogs instead of the current cash awards. This can go up to £737 per month.
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The DWP said: “We need to ensure we have a system that is sustainable and fair for everyone. PIP was designed to help with the extra costs faced by disabled and disabled people to enable independent living.”
“Some claimants will have significant additional costs related to their disability and others will have minimal costs. This Green Paper looks at whether there are ways to improve people’s support in a way that is also fairer to the taxpayer than the current system.” .”
There are currently about 3.5 million individuals receiving PIP, of which 2.6 million are of working age. The DWP says it processes 33,000 new PIP claims every month, a number that has more than doubled since before the pandemic.
The “unprecedented” rise in demand for PIP is being fueled by a significant increase in mental health related claims, which now make up the majority of claims. Here is an overview of the latest PIP rates. The benefit consists of two parts, each with its own standard and increased rate.
People can get one or two of these, giving eight possible PIP combinations. All are detailed below.
Personal Independence Payment (PIP) rates 2024-2025
A component for everyday life
- Standard: £72.65 per week (from £68.10)
- Extended: £108.55 per week (from £101.75)
Mobility component
- Standard: £28.70 per week (from £26.90)
- Extended: £75.75 per week (from £71.00)
PIP prices are based on a weekly payment rate but are paid every four weeks. So in months that are five weeks long, you may receive one PIP payment in your account at the beginning of the month and another at the end of the same month.
Below are all the possible payment amounts you can receive:
1. Standard daily life only
Pay rate: £72.65 per week
Monthly amount (every four weeks): £290.60
Annual amount (based on 52 weeks): £3,777.80
2. Just improved everyday life
Pay rate: £108.55 per week
Monthly amount (every four weeks): £434.20
Annual amount (at 52 weeks): £5,644.60
3. Standard mobility only
Pay rate: £28.70 per week
Monthly amount (every four weeks): £114.80
Annual amount (based on 52 weeks): £1,492.40
4. Only increased mobility
Pay rate: £75.75 per week
Monthly amount (every four weeks): £303
Annual amount (based on 52 weeks): £3,939
5. Standard daily life plus standard mobility
Pay rate: £101.35 per week
Monthly amount (every four weeks): £405.40
Annual amount (at 52 weeks): £5,270.20
6. Standard everyday life plus increased mobility
Pay rate: £148.40 per week
Monthly amount (every four weeks): £593.60
Annual amount (based on 52 weeks): £7,716.80
7. Better everyday life and standard mobility
Pay rate: £137.25 per week
Monthly amount (every four weeks): £549
Annual amount (for 52 weeks): £7,137
8. Better everyday life and increased mobility
Pay rate: £184.30 per week
Monthly amount (every four weeks): £737.20
Annual amount (based on 52 weeks): £9,583.60
This means the minimum payment a person can receive will be £290.60 every four weeks, an increase of £18.20 from the previous £272.40. The maximum will be £737.20 every four weeks, an increase of £46.20 from the previous £691.
The DWP said: “The UK has used a system of fixed cash transfers since the 1970s, but there are a number of international schemes which deal with the specific additional costs people have and instead provide more tailored support.
“For example, in New Zealand, the amount of Disability Allowance is based on additional costs per person, which are verified by a medical practitioner. The Norwegian Basic Benefit requires people to provide a letter from a GP describing the nature of their condition and the associated additional costs .” costs.
“We are looking at options such as one-off grants to better help people with significant costs such as home improvements or expensive equipment, as well as providing vouchers to help towards specific costs or reimbursing applicants who provide receipts for the purchase of gadgets, appliances or services. This reflects the fact that some claimants will have significant additional costs related to their disability and others will have minimal or specific costs.
“While these alternative models help people with the excess costs of their disability or health condition, we know that other forms of support including health care, social care provision and respite care are important to help people realize their full potential and live independently.” they also consider whether some people who receive PIP and have lower or no additional costs may have better outcomes from improved access to treatment and support than from a cash payment.”