UC rates
The Bill provides for above inflation increases in the standard rate of UC, from 2.3% above inflation in 2026/27 to 4.8% above inflation in 2029/30.
However, the LCWRA rate will be frozen from 2026/27 to 2029/30.
The LCWRA element rates for the 2026/27 tax year will be:
- pre-2026 claimant £423.27
- severe conditions criteria claimant £423.27
- claimant who is terminally ill £423.27
- any other claimant with limited capability for work and work-related activity £217.26
Severe conditions criteria - no private doctor diagnoses allowed.
The Bill provides that claimants who meet the severe conditions criteria for UC will never have to have another reassessment and will be paid the higher rate of UC health element of £97 per week.
The criteria are essentially the descriptors for being found to have LCWRA for UC - we cover this in more detail in "How the severe conditions criteria work" on this page - with four further requirement:
- The individual’s level of function will always meet LCWRA
- The individual’s condition will last for the rest of their life
- There is no realistic prospect of recovery of function, and
- The condition has been diagnosed by an appropriately qualified healthcare professional in the course of the provision of NHS services.
That last bullet appears to mean that an adult living in an area where they will have to wait literally years for an NHS assessment of say ADHD or autism will not be able to pay for a private assessment and have that accepted for the purpose of getting the higher rate of UC health element.
"one of the most generous ever"
The DWP press release boasts that:
"The Universal Credit and Personal Independence Payment Bill will provide 13-weeks of additional financial security to existing claimants affected by changes to the PIP daily living component, including those who their lose eligibility to Carers Allowance and the carer’s element of Universal Credit.
"The 13-week additional protection will give people who will be affected by the changes time to adapt, access new, tailored employment support, and plan for their future once they are reassessed and their entitlement ends.
"This transitional cover is one of the most generous ever and more than three times the length of protection provided for the transition from DLA to PIP."
Press release from the DWP
The DWP have issued a press release headed "Welfare bill will protect the most vulnerable and help households with income boost". It quotes Liz Kendall as saying:
"This legislation represents a new social contract and marks the moment we take the road of compassion, opportunity and dignity.
"This will give people peace of mind, while also fixing our broken social security system so it supports those who can work to do so while protecting those who cannot - putting welfare spending on a more sustainable path to unlock growth as part of our Plan for Change."
PIP changes in the Bill
The 4-point rule and the 13 week run-on if you lose your PIP because of it are confirmed. Plus a clause which could be used to allow for pension age PIP claimants to be exempt from the 4-point rule
Clause 5 deals with PIP.
Subsection 1 confirms the requirement to:
score at least 8 points, including at least 4 points for a single daily living activity, to get an award of the standard rate;
score at least 12 points, including at least 4 points for a single daily living activity, to get an award of the enhanced rate.
In other words, the 4-point rule.
Paragraph 6 (c) confirms that PIP will be payable for 13 weeks after a decision that you are no longer entitled to PIP daily living component as a result of failing the 4-point rule.
Subsection 2 says that the secretary of state (SoS) will decide the date on which the new rules begin. The explanatory notes add that this is intended to be November 2026. The change will not apply to any given claimant until their award is reassessed. So for claimants with longer awards it may be some years distant - by which time there may be an entirely new PIP test.
Subsection 4 appears to be a "get-out clause" to allow the SoS to make special provisions for particular groups of people. They almost certainly have pension age PIP claimants in mind here. The paragraph actually says:
"to make different provision for different cases or purposes (including different provision for persons of different ages);"
So, for example, it might allow the SoS to decide that the 4-point rule will never apply to any person at or over pension age, who is already in receipt of PIP daily living in November 2026. This would give pension age claimants an exemption, but it's interesting that this is not being put into the Act itself.
The subsection also allows the secretary of state to provide for "a person to exercise discretion in dealing with any matter".
Universal Credit and Personal Independence Payment Bill published
The bill has now been published. You can download the 22 page .pdf document from the Get file link on this page.
Or you can download the file directly from this link
You can download the explanatory notes from this page.
There's also an impact assessment on the Universal Credit Rebalancing from the Department for Work and Pensions - May 2025
Money Bill
There has been discussion about whether Labour will seek to have this bill designated as a money bill, which would effectively remove House of Lords scrutiny. A decision about whether a bill is a money bill is made by the Speaker of the House, after the report stage. However, according to guidance on Money Bills from the Office of the Parliamentary Counsel:
1.35 During the debates in 1911 it was alleged to be a defect in the bill that the Speaker was not required to make his decision earlier because of the risk of the Commons proceedings being completed in ignorance of whether the bill was to be certified. There is now an informal indication, published as a note when the Bill is listed on the Commons Order Paper, as to whether a bill is likely to be certified as a money bill.
The notice that the bill will be presented today on the Order Paper makes no mention of a money bill, so this seems to be an indication - though not a certainty - that Labour are not pursuing this possibility.
Bill due this afternoon
The Universal Credit and Personal Independence Payment Bill is due to be published this afternoon. This is the bill that will enable the introduction of the PIP 4-point rule and cuts to universal credit for disabled claimants.
We’ll provides links, analysis and the opportunity for you to comment on this page.
According to the UK parliament website, it is a: "Bill to make provision to alter the rates of the standard allowance, limited capability for work element and limited capability for work and work-related activity element of universal credit and the rates of income-related employment and support allowance, and to restrict eligibility for the personal independence payment."
