Incapacity benefit cuts consultation was ‘misleading’ and unlawful, judge rules

Labour’s plan to push through £3bn of cuts to incapacity benefits has received a setback after a judge ruled an official consultation setting out the proposals was misleading and unlawful.

The high court said the Department for Work and Pensions (DWP) had presented UK-wide incapacity benefit assessment reforms as a way to support disabled people into work without making clear the “primary rationale” of the proposals was cost savings.

The consultation, which was carried out by the previous government in autumn 2023, failed to mention that 424,000 disabled people would see their benefits cut, many losing £416 a month, the judge found.

Documents released to the court also revealed that internal DWP estimates suggested the reforms to the “fit for work” test known as the Work Capability Assessment (WCA) would push 100,000 highly vulnerable disabled people into absolute poverty.

Ellen Clifford, a disability activist who launched the legal challenge, said the proposed cuts had been “prioritised over lives”. She urged the government to rethink its proposals “and make the safety and wellbeing of disabled benefits their priority”.

Although the consultation was drawn up under the Conservatives, Labour defended it in court in December. The government is committed to reforming the WCA, and to making savings on incapacity benefit spending estimated at £3bn over four years.

Labour is expected to publish a green paper in the next few weeks setting out how it will take forward its plans. The party is keen to see more of the 2.8 million people out of work due to long-term sickness move into jobs as part of its employment strategy.

Mr Justice Calver’s ruling found the consultation was “misleading” because it failed to highlight the “substantial loss of benefit” faced by claimants and gave the impression reforms were required to give disabled people the option of employment help, when in reality they were about compelling them to access job help.

The judge said the DWP had unfairly neglected to make it plain that cost savings were the rationale for the reforms. The eight-week consultation period was also far too short, given the significance of the proposals.

Clifford said: “We now know that civil servants and ministers were making desperate attempts to ‘find’ a rationale for the cuts, which they thought would be less controversial … to make it appear as though saving money was not their primary motive. It is heartening that Mr Justice Calver agreed with us that this is ‘back-to-front policymaking’.”

She added: “The crucial question is what lessons the government should learn from this case. Measures to help the economy should not require the impoverishment and suffering of hundreds of thousands of disabled people.”

The DWP’s proposals to reform the WCA would mean most new or reassessed incapacity benefit claimants would not be assigned to the Limited Capacity for Work-Related Activity group. This cohort, the majority of whom are on low incomes, would lose just under £5,000 a year as a result.

Campaigners have long argued that the proposals were primarily a cost-saving measure, and that the employment opportunities for claimants were overstated. The Office for Budgetary Responsibility has estimated that only 3% of claimants affected would be able to move into work.

David Southgate, a policy manager at the disability equality charity Scope, said: “It’s good that the previous government has been called out for its mistakes. Proposed changes to the WCA were only about saving money, not meaningful change. Life costs a lot more when you’re disabled, and cutting support to those who need it most will lead to even more disabled people living in poverty.”

Ayla Ozmen, the director of policy and campaigns at the anti-poverty charity Z2K, said: “As the current Labour government sets out its own plans to reform the disability benefits system, the ruling sends a clear message that it cannot mask a cost-cutting exercise with claims of increased employment.”

A government spokesperson said: “The judge has found the previous government failed to adequately explain their proposals. As part of wider reforms that help people into work and ensure fiscal sustainability, the government will re-consult on the WCA descriptor changes, addressing the shortcomings in the previous consultation, in light of the judgment. The government intends to deliver the full level of savings in the public finances forecasts.”