Guess how many students will be hit by Welfare reforms. You’ll have to – the government doesn’t know

The Press Release from the Department for Work and Pensions (DWP) notes that almost a million young people – 1 in 8 – are not in education, employment or training.

So given the apparent partial U-turn on the Bill will see existing claimants protected but new claimants’ entitlements cut, MPs should probably ask themselves if the reforms will so anything to decrease that figure.

Or – as seems more and more likely – they’ll actually increase the number.

There are two aspects of concern. The first is that while most students can’t get Universal Credit (UC), if they’re in full-time education and have been assessed as having limited capability for work by a Work Capability Assessment before starting their course, they can.

We’ve talked before about the UC taper, and how it hits students harder than others – but there is also a health element of Universal Credit.

One of the less discussed proposals would mean raising the age someone can receive the health element of Universal Credit to 22.

That will create a particularly challenging situation for disabled students aged 18-21. With the current rate at £97 per week, it represents a potential loss of over £5,000 per year for affected students – a substantial sum that could determine whether someone can afford to pursue or continue their education.

PIP changes

But it’s the PIP changes that will hit hardest. According to a detailed analysis published by the Campaign for Learning, approximately 43,000 young people aged 16-24 in England and Wales could lose the standard or enhanced rate of the daily living element of Personal Independence Payments (PIPs) because they score less than 4 points in the eligibility assessment.

That would represent a loss of between £4,000 and £5,750 per year at current rates.

Have a guess how many students that will impact. You’ll have to – because apparently, the government doesn’t know.

Neither the Department for Work and Pensions (DWP) nor the Department of Education (DfE) know whether the 43,000 16–24-year-olds at risk of losing either the standard or enhanced rate of the daily living element of PIP are NEET or not.

In other words, the government is proposing to remove up to £5,750 per year from 43,000 young people without knowing whether they’re in education, employment, or already among the NEET population they claim to be helping.

When CfL’s Paul Bivand and Mark Corney submitted Freedom of Information requests, the DWP admitted they “had no information on whether these young people were in full-time or part-time education.”

Similarly, the Department for Education responded that it “had no information on whether young people in full-time or part-time education were claiming PIP and were NEET or not.”

DfE eventually produced some data, but it was from 2019/20 – six years out of date.

Bivand and Corney think we can assume a significant proportion of the 13,000 non-employed 18–21-year-old PIP (DLE) claimants are in full-time education, given 50 per cent of the cohort in general are in full-time education.

The mental health dimension adds another layer of concern. 43,000 young people that currently receive PIP despite scoring below 4 points, but under the new rules they would lose this support entirely.

Bivand and Corney’s analysis reveals that around 19 per cent of PIP claimants of working age falling below the 4 point threshold report having ADHD/ADD and 48 per cent with anxiety and depression.

These are young people whose conditions are serious enough to qualify for support under current rules, but not severe enough to meet the proposed higher threshold. Given the well-documented rise in mental health issues among university students, withdrawing financial support from those with anxiety, depression, and ADHD could force them out of education at precisely the time they need stability and support most.

The potential scale of the problem becomes clear when we consider:

…if the entire 27,330 non-employed PIP (DLE) claimants aged 18-24 are in full-time education and the loss of £4,000 and £5,750 per year causes them to drop out, the NEET rate using March 2024 as the baseline would rise from 15.1% (859,000) to 15.6% (886,000).

Each of these 43,000 young people represents an individual with aspirations and potential. The loss of support could force them to choose between continuing their education and meeting their basic needs. For disabled students who rely on the income to cover additional costs related to their conditions the removal of support could make university life unsustainable.

The authors propose seven urgent actions, with several specifically addressing the higher education context. They call for the DfE and DWP to examine the extent to which the loss of support could increase poverty amongst students and lead to drop-out – and thereby a rise in NEET. Presumably each of those departments think it’s the other’s problem (if they think it’s a problem at all).

The marmalade has to go somewhere

Some will say “are there really this many Disabled students”, but the policy problem represents a textbook case of what Sam Freedman calls “demand displacement” – where attempts to reduce costs in one area just shift them elsewhere at greater expense.

Just as cutting GP appointments led to more costly A&E attendances, and reducing mainstream school support created an explosion in expensive EHCPs, removing PIP from disabled students won’t eliminate their financial needs. It will just push those costs into university hardship funds, mental health services, and ultimately – when students drop out – into the unemployment and housing benefit systems.

As Freedman argues:

You can’t remove real need by removing support, it will just manifest in a different form.

The parallels with the special educational needs crisis are particularly striking. Just as the 2014 SEND reforms inadvertently created a surge in applications for EHCPs by removing lower-level support, inadequate maintenance loans are likely to mean more claiming PIP to just about survive university.

Remove the PIP element and universities will face a surge in hardship applications, demands for emergency accommodation support, and pressure to provide services that PIP payments previously enabled students to purchase themselves:

Once you’ve created a system in which people have to go through a more painful process, but end up with something of higher value it’s very hard to take it away from them again.

We already know that disabled students are more likely to rely on maintenance loans as they often can’t supplement their income through part-time work due to their conditions. The Disabled Students’ Allowance (DSA), which is meant to cover disability-related study costs, is frequently delayed – support sometimes arriving months into the academic year – and doesn’t cover living costs.

And of course, a rise in disabled students, and a rise in claiming PIP, doesn’t necessarily reflect an increase in disability rates among the student population.

As with the broader benefits trend Freedman identifies, it reflects changing economic pressures that make previously manageable situations unmanageable.

A student with ADHD or anxiety might have coped without declaring their condition to the university or claiming benefits when maintenance loans were more adequate, part-time work was available and unnecessary, and living costs were lower.

But as Freedman notes about the benefits system more broadly:

…people who apply for help with mental (or physical) health issues do have them… However, they may not have felt they needed the extra support, and the hassle or embarrassment of applying for it, before, and now they do.”

The combination of inadequate maintenance loans, soaring rents, a record number of set assignments and the cost-of-living crisis may well have transformed PIP from something students might have foregone due to stigma or administrative burden into an essential lifeline.

The shift from “optional” to “essential” is precisely what happens when, as Freedman observes, other forms of support are systematically eroded – people are forced to access whatever remains available, regardless of the personal cost in terms of privacy or dignity.

The biggest problem of all, of course, is that the DWP policy doesn’t really talk about education at all – a facet of the old silo’d Whitehall department problem. The much vaunted “opportunity mission” can only work if the departments of Heath, Housing, Work and Pensions, Transport and so on are caused to work together to enable opportunity. There’s little sign of that so far.