Research published only last week by the National Institute for Economic and Social Research showed that we spend less on welfare as a share of GDP than the average for developed nations. Also when it comes to the so-called replacement rate - what any unemployed person receives as a proportion of earnings from employment - only the unemployed in Australia and the US receive less. Unemployment payments are significantly higher everywhere else in Europe, for example. And another thing. As the Joseph Rowntree Foundation has shown, standard universal credit does not cover the costs of basics and essentials, for families or single people. “Ah ha!” you may exclaim, especially if you are the PM or chancellor. Surely this proves that there is a unhealthy incentive in the UC system for any claimant to prove that he or she has “limited capacity for work or work related activity” - to be diagnosed as unfit for work - so that their UC entitlements would go (for a single person) from £400 to £823, a month. But is an extra £106 a week the kind of incentive that would persuade a vulnerable person to permanently shut down their availability for work? And if it were cut and partly offset by a rise in standard universal credit - which is what Starmer plans - would that persuade the vulnerable person to look for jobs? That doesn’t feel compelling as an argument - especially in a world where most employers are reluctant to employ disabled people, let alone retain them on their books. So another concern about the timing of these welfare changes is they come well before the findings of an equally important government review, that by former John Lewis boss Charlie Mayfield about how employers can be helped to retain and hire disabled people. Later this week he will publish his “discovery” document, about why employers struggle to keep in employment those who start to feel unwell, especially those suffering from mental ill-health. However Mayfield is still months away from recommendations. In other words, it feels cart-before-horse to take cash from the disabled before a new support system is in place for employers to keep on their books those who are struggling. As for the proposal to increase the threshold for those claiming the PIP, this will have an impact both on new claimants and those in receipt who are subject to review. How many disabled people could see their PIP payments reduced or withdrawn altogether? Very large numbers indeed, according to the Resolution Foundation if it remains the Treasury’s aim to find net savings of up to £6bn by 2029-30. Louise Murphy of the Foundation estimates that more than 600,000 people, most on low incomes, would lose £675 a month on average. Obviously this is all still hypothetical. Proper judgement awaits publication of the Liz Kendall’s policy paper tomorrow. But a change in entitlement on that magnitude will generate massive anxieties in those who both receive PIP and may need it in future. None of this is to argue that any government should ignore the forecast that on current trends the cost of PIP is set to rise by £15bn by 2029 or that large numbers of especially young people are being excluded by disability from the world of work too young. It is to suggest that reforms that could reduce benefit bills in the long run will require large expenditure in the short term on mental health provision, skills, rewiring coaching and job search at the DWP, occupational health support for companies and so on. A rational approach would see the costs of supporting the disabled rise in the short term. It would be an investment programme, not a cuts programme. With the supposedly all-important fiscal assessment looming, we’ll see if that’s what Starmer , Kendall and Reeves unveil. 2/2