A government-commissioned review will recommend moving people under 25 off main sickness and disability benefits, according to reports by the Times.
The report by Alan Milburn, a former Labour health secretary, took one year to complete. He proposes a radical overhaul of the welfare system. This aims to address the number of young people not in education, employment, or training.
The government tasked Milburn to help reduce the “Neet” population. One in eight 18- to 24-year-olds in the UK are not in education, employment, or training.
Milburn said his proposed measures would not be “pain-free”. He said these changes would impact new claimants and those already receiving benefits. He spoke on Wednesday night.
The recommendations expect to move under-25s away from the health element of personal independence payment (Pip) or universal credit. These claimants would instead receive an allowance. This allowance would be set at the same basic rate as universal credit.
People with more severe disabilities who cannot work would receive a new benefit. This benefit would be paid at a higher rate. The government intends to move these reforms into legislation in the new year.
Milburn is also expected to suggest investing billions of pounds into employment support for young people. This could include job subsidies and work placements. It could also include one-to-one personal advisers.
Milburn argued the current framework leaves hundreds of thousands of young people trapped in poverty. “you've got hundreds of thousands of young people stuck in a benefit system that is trapping them in poverty, giving them no prospect of prosperity or a job” Alan Milburn, a former Labour health secretary, said.
Data from the Office for National Statistics (ONS) covers the period of April to June. This data suggests just under one million young people in the UK are Neets. This is a 3% increase from the same period last year.
Prime Minister Andy Burnham is likely to support the recommendations. However, Labour MPs may oppose them. These MPs previously opposed welfare reforms under his predecessor Sir Keir Starmer.
The British state could take almost a decade to see monetary savings if the recommendations are approved.
Prime Minister Andy Burnham said the country requires a wholesale change in its support for young people. He said the focus should be on investment in their success rather than paying for failure.
Earlier coverage: Labour Says Planned Tory Welfare Cuts Are a Charter for Human Misery