The Downing Street team is examining whether the recent “participation‑first” welfare plan – which swaps key disability benefits for work‑and‑training support for those under 25 – should be rolled out to older age groups, a move that could reignite Labour’s internal debates over benefits reform.
Milburn Review sets out new support model for under‑25s
Adviser Alan Milburn is due to publish his findings next week, recommending that young people receive intensive training and employment assistance instead of the universal credit health component. Under the proposal, the personal independence payment (Pip) would be replaced by a localised fund for short‑term equipment and expenses, while those with the most severe needs would retain protected entitlements. Milburn estimates his package would create 440,000 education or work opportunities by 2036 and lift young people’s net incomes by more than £2 billion. He argues that the barrier is not a lack of ambition among youth but a shortage of genuine chances.
Some Treasury officials fear the upfront £6 billion cost could be drawn from existing departmental budgets, raising concerns at the Department of Health and the Department for Education.
Cabinet debates extending the reforms beyond the under‑25 cohort
ministers, including Andy Burnham and work and pensions secretary Pat McFadden, have examined whether the same principles could apply to people over 25, a discussion that could be triggered by a prime‑ministerial intervention or a ministerial statement. The cabinet is aware that applying the model more widely would involve a larger population and potentially lower per‑person support costs, but it would also risk a backlash from Labour backbenchers still uneasy after last year’s rebellion that forced a U‑turn on health and disability benefit changes.
Sources close to the talks say the proposal may not survive the expected opposition, yet others believe Milburn’s argument that the system is unfit for purpose has gained public backing.
Concerns from charities and the wider Labour party
More than 40 leading charities have warned that cutting benefits or imposing sanctions on disabled young people could push thousands deeper into poverty and away from employment. The Joseph Rowntree Foundation warns that many young people on universal credit – currently receiving about £80 a week – could see their incomes shrink when essential costs such as food or transport are factored in, making education or work harder to sustain.
Polling indicates that while the public supports trimming the overall welfare bill, they favour tackling the root causes of joblessness rather than reducing benefits, a view that may shape the government’s final approach.
Funding, savings and the timeline for implementation
Milburn’s report will provide costings for the initial investment and a trajectory for projected savings, though it stops short of committing to the full £6 billion figure. A government spokesperson said the Milburn and Timms reviews are imminent and that the administration will respond comprehensively, stressing that a safety net will remain for those unable to work.
The prime minister has pledged a wholesale shift in how young people are supported, emphasising investment in success rather than payment for failure, while acknowledging the need to adapt the plan to the more complex circumstances of older adults, including family and caring responsibilities.
Why it Matters
If the government succeeds in extending the “participation‑first” model to all working‑age adults, it could reshape the UK’s welfare landscape, delivering billions in savings and boosting labour market participation. However, the proposal’s reliance on cutting disability benefits – especially for the most vulnerable – risks deepening poverty among disabled youth and triggering a severe backlash within Labour, potentially undermining the very political consensus needed to sustain such ambitious reforms.
