UK loses £118bn a year to poor mental health. Cutting benefits is not the answer

The UK government’s announcement this week about changes to the benefit system was remarkable.

One the one hand, it contained one of the biggest expansions of support for people out of work or on low incomes in recent memory, something which should genuinely be lauded.

Yet on the other, we learned of counterproductive cuts to both personal independence payment (PIP) and universal credit for some groups, which will harm many individuals experiencing mental health problems. These were met with widespread shock from experts like us, who spend our working lives thinking about how we can support people to stay mentally healthy.

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The government’s stated aim is to reduce the number of people out of work with mental health problems by better enabling them to return to work. They are, like everyone who’s aware of the problem, concerned by the scale of poor mental health in this country causing people to be unable to work.

Measures such as the ‘right to try’ scheme, which will allow people in receipt of universal credit to attempt to return to work without penalising them if they find they were not ready for it, are what we need to help address this challenge. As the government has highlighted, many people out of work with mental health problems want to work.

Those same people also tell us that better support is what’s needed for them to do so. Giving people the ability to try work, without the threat of the five week wait for universal credit looming over them, is genuinely progressive – particularly when combined with the increase in statutory sick pay.

Similarly, increasing the base rate of universal credit is welcome. This will provide relief to those on the lowest incomes, which we know are linked to poor mental health. Research we carried out in partnership with University of Leeds suggested that a weekly £25 uplift for parents in receipt of universal credit could see them experience a reduction in poor mental health. We still expect the change the government has announced to bring positive change, although there is clearly a good case for this to be raised further.

Expert organisations like ours generally agree that these sorts of progressive measures are the best way to support people back into work, and these policies show the UK government clearly understand this too. But this raises a question – why did they also feel the need to also bring forward counterproductive measures, such as the cuts to PIP eligibility and removing access to the health element of universal credit for under-22s?

The answer, we believe, is a lack of faith from government that these progressive moves will deliver change. Burdened by the fear of the financial situation the government finds themselves in, decision makers seem to have reached for the orthodoxy of the last 15 years: if we reduce spending, costs will fall.

The truth is that the underinvestment and cuts of the past 15 years (alongside the pandemic and cost of living crisis) are how we ended up with rising numbers of people with mental health problems. The Public Health Grant, designed to enable councils to put in place measures to prevent health problems arising, has still not recovered to its pre-2015 levels.

Wages have stagnated, housing is harder to afford for the average earner than it has been in living memory, and people in receipt of benefits have seen their incomes dwindle. With the building blocks of good mental health pulled out from under people’s feet, is it any wonder that people are struggling?

Make no mistake, the cuts to PIP and universal credit for many will have the same outcome – they will make mental health worse. Despite this, the UK government has deferred to their instincts to ‘cut to save.’

Perhaps this is because the Treasury do not have the same responsibility that the Department for Work and Pensions (DWP) and the Department for Health and Social Care (DHSC) have for the health and wellbeing of people. This is exactly why the mental health sector have been calling for a cross government mental health plan in recent years.

Alternatively, it may just be much simpler to show evidentially that cutting £5bn in spending will lead to £5bn in savings, and much harder for civil servants to demonstrate savings resulting from investment. Instead, it falls to organisations like the Mental Health Foundation to calculate that not preventing poor mental health costs the economy and society at least £118bn a year.

Whatever the reason, this doesn’t justify the cuts delivered. Labour should instead have faith that delivering the progressive measures will lead to positive outcomes.

There is precedence for this faith. When a Labour government launched Sure Start in 1999, evidence was limited as to its potential or success. Even 10 years later, evidence of its benefits was unclear. But by 2019, those who had argued for this support were proved right, and the IFS found that Sure Start saved the NHS millions of pounds and delivered on its goals of lifting children out of poverty.

We believe the same would be true of employment support if the government were to only push through with the positive elements announced yesterday. We urge the government to have the same aspiration as the Blair government did in 1999. They must take a leap of faith that they can trust mental health organisations. If they help people get better, build up support to get back into work, and improve workplaces, then people with mental health problems will return to the workplace – because they want to.

Oliver Chantler is head of policy and public affairs at the Mental Health Foundation.

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