DWP PIP can Cut up to £6,300 a year: New DWP rules may hit Low-Income Households the Hardest

You might have seen headlines DWP recently about big changes coming to the UK’s Personal Independence Payment (PIP). Under Labour’s new rules, more than a million people who rely on this support could lose part or all of their payments—meaning some households might see their income drop by as much as £6,300 each year. These reforms aren’t just about tightening eligibility—they’re also about shifting how the system judges disability. Let’s take a closer look.

What Exactly Is PIP?

PIP is a benefit aimed at helping people who face long-term health conditions or disabilities that make daily life more difficult. It’s not a payment linked to whether you work or not—it’s all about whether you need extra support.

There are two parts to PIP:

• Daily Living Component – This helps cover the cost of everyday tasks, such as preparing food, getting dressed, washing, or managing medication.
• Mobility Component – This helps with getting around—walking, moving about safely, or planning travel.

Each component is paid at one of two rates:

• Standard Rate
  • Daily Living: £72.65/week
  • Mobility: £26.90/week
• Enhanced Rate
  • Daily Living: £110.40/week
  • Mobility: £71.00/week

That’s up to about £9,200 a year for someone receiving both enhanced rates—so losing that support could be devastating.

What’s Changing?

Labour’s proposed reforms will shift how the Daily Living Component is awarded. Under the current system, claimants accumulate points based on the amount of help they need with different activities. Scoring a certain number of points can qualify you for standard or enhanced rates.

But under the new proposal, only individuals who score at least 4 points in a single activity area would be eligible—meaning they must need extensive help with, for example, preparing food or managing medication or getting dressed, and so on.

In short, unless someone is severely impacted in at least one area, they might get nothing at all—even if they hold several activities where they score lower points.

Who Stands to Lose Out

Analysis from the Resolution Foundation suggests that the change will hit those already struggling. Around 70% of PIP claimants are in the bottom half of UK household incomes. By 2029–30, as many as 800,000 to 1.2 million people could lose part or all of their benefit.

The average cut per person could range from £4,200 to £6,300 annually, depending on whether they were previously receiving the standard or enhanced rate. For some, this could mean suddenly being stretched to cover the additional costs of care, support, or simply managing day-to-day life.

Why Now?

The impetus behind these reforms is largely financial. The government is aiming to save around £5 billion from he PIP budget as part of a broader attempt to reduce public spending and meet fiscal targets. Critics argue that the changes are being driven more by cost-cutting than by helping people transition back to work or become more independent.

Expert Warning: “Short-Term Savings, Long-Term Pain”

Economists and disability advocates aren’t holding back. Louise Murphy of the Resolution Foundation warned that while some people might gain support aimed at getting them into work, the bigger picture is a massive income cut for many who already have significant needs.

Her main concern? That the system will be reshaped to benefit those who can work, while punishing people whose conditions don’t allow them to do so—even if they still struggle massively in day-to-day life.

How the System Might Work Under New Rules

Here’s a closer look at how the activity-based scoring would kick in:

• Current PIP Model: You score points across various activities based on how much help you need. Collect enough points and you receive standard or enhanced rates that reflect your overall level of need.
• Proposed New Model: Now, you need at least 4 points in one category—like managing medication or preparing meals. Score three points across several categories, but never four in one, and you get nothing.

That means someone with moderate difficulties in multiple areas might fall through the cracks, losing vital financial support.

Real-Life Scenarios

Mary, diagnosed with cerebral palsy, needs help with walking, cooking, and cleaning. Currently, her scores allow her to claim £110.40/week for Daily Living (enhanced). Under the new rules, unless she scores 4 points in just one task—maybe eating or washing—she could lose all her money, even though her overall support needs haven’t changed.

Dan, living with moderate autism and anxiety, scores 3 points for several tasks but doesn’t hit 4 anywhere. Although all activities combined show a genuine struggle, he could lose £3,773 per year—a devastating financial blow.

Who Is Most at Risk?

The groups most likely to be impacted include:

• People with multiple moderate disabilities rather than a single major one
• Those with visual or mobility issues that affect multiple tasks but not severely enough in one
• Households already on low incomes, making the loss even harder
• Parents or single carers who juggle family responsibilities without being able to meet the harsh new thresholds

Why It Matter

For many, PIP isn’t a luxury—it’s a lifeline. It covers:

• Care or travel support
• Specialized equipment or home modifications
• Services that allow independence (e.g., cleaning, buying groceries)
• A buffer against higher living costs

Removing this income will push thousands into financial crisis.

What to Do If You Currently Receive PIP

If you’re already claiming PIP—or planning to—here’s what you can do:

The Wider Picture: Justice or Hardship?

Supporters say the reform pushes the system toward helping those with the greatest needs and discouraging residual claims. But opponents argue that it’s a short-sided cost-saving measure that ignores the real and complex daily realities of living with a disability.

Final Thoughts

These proposed PIP reforms won’t just tweak how much money people get—they could erase vital support for thousands living with serious disabilities.

If you—or someone you know—rely on PIP, it’s vital to:

• Stay informed on policy changes
• Track eligibility thresholds
• Seek professional advice
• Keep detailed health, medical, and daily activity records

The risk isn’t just losing money; it’s losing stability, independence, and dignity.

FAQs