The Department for Work and Pensions (DWP) has confirmed a significant change to Universal Credit, with a new, lower health element set to take effect from 6 April 2026.
Key Details of the Universal Credit Reform
This legal adjustment was formalised through the Universal Credit Act 2025, which received Royal Assent on 3 September 2025. The government states this legislation delivers the first sustained, above-inflation increase to the standard allowance, benefiting millions of claimants.
However, this change is coupled with a reduction in the UC health element for new claimants. The DWP argues this dual approach addresses what it describes as "perverse incentives" within the benefits system, aiming to better encourage those who can work to enter or return to employment.
Government Response to Select Committee
The announcement came as part of the DWP's formal reply to recommendations from the Work and Pensions Select Committee. The Committee had urged the government to delay the health element reduction until a comprehensive, independent assessment of its impact on disabled people could be completed.
In its response, the DWP declined to delay the implementation. It referenced an updated Impact Assessment published in July 2025 and confirmed it will "keep standard allowance rates under review."
The government also addressed concerns about the pace of change, particularly regarding Personal Independence Payment (PIP). It highlighted that clause 5 of the original Bill was removed, meaning PIP reforms will now be advanced separately through the co-produced Timms Review with disabled people and experts.
Broader Context and Future Plans
This law change represents the initial implementation of reforms proposed in the Pathways to Work Green Paper. The government reiterated its core principles: those who can work should be supported to do so, while those who can never work should be supported to live with dignity.
Wider reforms, including the introduction of a "right to try guarantee" to give people with health conditions the security to try work, continue to be developed following a public consultation. The government has committed to setting out its further plans in due course.
