Alan Milburn’s year-long government-commissioned review will recommend that under-25s be moved off the main sickness and disability benefits and receive an allowance at the same basic rate as Universal Credit instead.
The review, commissioned to help reduce the number of young people not in education, employment or training (Neet), will be published on Tuesday. It is expected to propose that under-25s can no longer claim the health element of Universal Credit or Personal Independence Payment (Pip). Instead, they would receive an allowance at the same basic rate as Universal Credit, with some eligible for a new “additional cost allowance” to cover day-to-day costs related to their conditions.
Milburn told the Times the changes would not be “pain-free” and would affect both existing and new claimants. “Candidly, it could mean that some people will get less financial support at the beginning of their benefit claim than under the current system,” he said.
He argued the current system prioritised short-term finances over long-term life chances. “I think what the current system does [is] it prioritises the latter over the former. I believe that’s the wrong choice and it needs to be the other way around.”
The review is also expected to recommend billions in investment in employment support, including work placements, job subsidies and one-to-one personal advisers. Those with severe disabilities unable to work would get a new benefit paid at a higher rate.
Under the plans, young people could lose some benefits if they did not engage with the support options. “A deal isn’t a deal unless there are potential consequences,” Milburn said. “Entitlements and responsibilities are two sides of the same coin.”
The government is expected to take the recommendations forward into legislation in the new year, with Prime Minister Andy Burnham likely to back them. However, the proposals could prove controversial among Labour MPs, who opposed welfare reform under his predecessor Sir Keir Starmer.
A government spokesperson said: “We will always ensure there is a safety net for the most vulnerable and those who are unable to work. But the prime minister has been clear that we need a wholesale change in the way we support young people to grow up in this country, where we invest in their success rather than paying for failure.”
Just under one million young people in the UK are Neet, ONS data from April to June suggests, a rise of 3% on the same period last year.
Analysis
Why This Matters
• The proposals would fundamentally change the welfare system for young people, potentially reducing immediate income for many but aiming to improve long-term employment outcomes.
• The review addresses the rising number of NEETs (nearly one million), a key social and economic concern.
• The outcome could become a major political battleground within the Labour Party and set a precedent for welfare reform under Prime Minister Burnham.
Background
Alan Milburn, a former Labour health secretary, was commissioned by the current Labour government to lead a year-long review into youth unemployment and welfare. The review is due for publication on Tuesday and is intended to help reduce the proportion of 18- to 24-year-olds not in education, employment or training.
Key Perspectives
Alan Milburn: Argues the current system traps young people in poverty and prioritises short-term finances over long-term life chances. His plan would involve less initial support but greater investment in employment services.
Government spokesperson: Emphasises maintaining a safety net while pursuing “wholesale change” to support young people into work.
Labour MPs: Likely to oppose the reforms, having previously opposed welfare reform under Sir Keir Starmer. The review could prove controversial among them.
What to Watch
• Publication of the review on Tuesday and immediate political reactions.
• The government’s legislative timetable for welfare reform in the new year.
• Potential Labour MP rebellion or amendments to the proposals.
Checked
11 claims in this story checked against 1 source: 10 supported.
Show each claim
- SupportedMilburn’s review will propose benefit cuts for some under-25s.BBC News: “Some young people could see reductions to the benefits they are entitled to, under a radical overhaul of the system to be recommended by a government-commissioned review.”
- SupportedThe review will recommend moving under-25s off the main sickness and disability benefits.BBC News: “Alan Milburn's year-long report, which will be published on Tuesday, will recommend moving under-25s off the main sickness and disability benefits, the Times reported, external.”
- SupportedUnder-25s would instead receive an allowance at the basic Universal Credit rate, with some eligible for an additional cost allowance.BBC News: “Instead, they would receive an allowance on the same basic rate as universal credit. Some could be eligible for a new "additional cost allowance" to cover day-to-day costs related to their conditions.”
- Partly supportedMilburn told the Times that the changes would not be “pain-free” and would affect existing and new claimants.BBC News: “He said on Wednesday night that his plans would not be "pain-free" and would affect both existing and new claimants.”
- SupportedMilburn said some people could get less financial support at the beginning of their benefit claim than under the current system.BBC News: “"Candidly, it could mean that some people will get less financial support at the beginning of their benefit claim than under the current system."”
- SupportedMilburn said the new system would involve “rebuilding the system from scratch”.BBC News: “The new system "will need significant investment" and would involve "rebuilding the system from scratch," Milburn added.”
- SupportedMilburn said the current system prioritises short-term finances over young people’s longer-term life chances.BBC News: “I think what the current system does [is] it prioritises the latter over the former. I believe that's the wrong choice and it needs to be the other way around.”
- SupportedThe review is expected to recommend billions in investment in employment support, including work placements, job subsidies and one-to-one advisers.BBC News: “Milburn, a Labour MP from 1992 to 2010, is also expected to recommend an investment of billions into more employment support for young people, including work placements, job subsidies and one-to-one personal advisers.”
- SupportedYoung people could lose some benefits if they do not engage with the extra work-support options.BBC News: “His new proposed system would involve an element of carrot and stick, where young people could lose some of their benefits if they did not engage with the extra work support options.”
- SupportedA government spokesperson said there would be a safety net for the most vulnerable and people unable to work.BBC News: “A government spokesperson said: "We will always ensure there is a safety net for the most vulnerable and those who are unable to work."”
- SupportedJust under one million young people in the UK were Neet in April to June, up 3% on the same period the previous year.BBC News: “Just under one million young people in the UK are Neets , data from the Office for National Statistics (ONS) from April to June suggests. This was a rise of 3% on the same period last year.”