Thousands of people claiming Universal Credit due to health conditions will see their monthly payments reduced from April 6 under new Labour reforms.
The sickness payment component will be cut by around 50 per cent for new claimants, falling from £423.27 per month to £217.26.
This represents a weekly drop from £105.82 to £54.32 and a loss of £2,472 per year for those affected.
These changes form part of wider reforms introduced through the Universal Credit Act, which received Royal Assent on September 3, 2025.
Legislation included an above-inflation increase to the standard allowance while reducing the health element for new applicants.
The Limited Capability for Work and Work-Related Activity element (LCWRA) provides additional support to those whose health conditions or disabilities prevent them from carrying out basic work-related tasks.
Qualifying conditions include severe mental health issues affecting social interaction, physical disabilities limiting movement or sitting, terminal illness, and those undergoing cancer treatment.
Universal Credit cuts 2026: Health element to be halved for new claimants from April 6
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Existing claimants and those who submit applications by April 5 will continue receiving the higher rate.
New claimants with severe or terminal conditions will also be protected from the reduction under special provisions.
The LCWRA payment currently exceeds the standard Universal Credit allowance of £316.98 per month for single people aged over 25, a gap the Government has identified as a concern.
Ministers argue the current structure creates "perverse incentives" within the system.
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Universal Credit is a benefit payment reserved for those on low income | PAThey say the higher health element can make it "attractive to be sick", while claiming Universal Credit, discouraging some people from seeking work.
Official figures show around one per cent of LCWRA recipients move into employment each month.
The Department for Work and Pensions (DWP) said the reforms "better encourage those who can work to enter or return to employment".
Welfare spending is forecast to continue rising, according to the Office for Budget Responsibility.
Spending is expected to increase by £18billion to £333billion this year, potentially reaching £407billion by 2030-31.
The Work and Pensions Committee has warned of potential consequences from the policy.
Chair Debbie Abrahams said: "The Government's own analysis published in March indicates that from next April approximately 50,000 people who develop a health condition or become disabled and those who live with them - will enter poverty by 2030 as a result of the reduction in support of the UC health premium."
Ms Abrahams said the system could create unequal outcomes, with people receiving different levels of support depending on when they applied.
The committee recommended delaying the changes until additional support measures, including increased NHS capacity and employment programmes, are in place.
Ms Abrahams said: "The reduced payments risk exacerbating their condition and pushing them further away from the labour market."