The changes to regulations for the Personal Independence Payment (PIP), announced before Christmas, are likely to cost the economy up to £1 billion annually, according to a new report by ‘We are Spartacus’. 

Emergency Stop analyses the likely financial and social impact of the changes, which were greeted with dismay by many in the disability sector.  The detailed research is based on statistics from the Department of Work and Pensions and reports from Oxford Economics.  The changes announced by the Government include reducing the distance which people must be unable to walk in order to qualify for the highest rate of the mobility component from 50 metres to 20 metres.

The Government estimates that the changes it has made to the PIP regulations will reduce the number of people who qualify for the enhanced rate of the mobility component by up to 428,000.  This is the element which qualifies disabled people to apply for the Motability car scheme – a lifeline for many.  Losing access to a Motability car will undoubtedly have a negative effect on the lives of many disabled people, leaving them isolated, reducing their social and economic independence and making it harder for them to access education, training and paid work.

Research has shown that the Motability scheme accounts for about 10% of new car sales in the UK as well as supplying a significant number of cars to the used car market.  As ‘Emergency Stop’ shows, over 21,000 jobs across the UK are directly or indirectly related to the Motability scheme and industries related to the scheme contribute over £2 billion to GDP annually.  The proposed changes to the PIP criteria are expected to lead to the loss of over 5,500 jobs and a reduction in GDP contribution of £544 million per year.

It is estimated that the Motability car scheme enables 12,500 customers and informal carers to get a job and helps a further 56,100 to keep their jobs.  ‘We are Spartacus’ believes that a further £504 million will be lost from GDP annually as disabled people who rely on their cars to help them work will have to give up their jobs as public transport is either not available or too inaccessible.  This runs counter to the Government’s aim of supporting more disabled people into work.

In addition to concerns around reducing the distance which people must be unable to walk, the The Hardest Hit coalition is worried that the provision that people must be able to complete activities “safely, reliably, repeatedly and in a timely manner” will not be included in regulations – only in guidance.  The distinction is significant as inclusion in regulations means that there would be a legal requirement for it to form part of the assessment process, whereas guidance is open to interpretation by the assessor.  The regulations will not be subject to any further consultation, so the Hardest Hit is calling on campaigners to write to their MP to challenge the last minute changes before they become law and damage the lives of disabled people.

Rachel Bowen, campaigns officer.