The work and pensions secretary, Iain Duncan Smith, is set to push through reforms to the disability allowance that could see the benefits bill cut by £2.24 billion a year but at the cost of half a million people losing their benefit.

Interviewed by the Telegraph the minister said that recent years had seen an increase of 30% in claimant numbers and that the cost of benefits would soon be reaching £13 billion a year.

This was caused by the way the disability allowance had been structured said Duncan Smith and had led to the number of claimants rising well ahead of general trends in society.

His plan is that over the next four years some two million claimants will be reassessed and only those who are considered to be in need of any support would get the new benefits.

This would lead to the system being ‘more focussed’ on those in genuine need of support. A system where for example the loss of a limb would only attract payment to the level that it affected someone’s ability to get around.

The minister said that he was not afraid to grasp this nettle in order to prevent the system being exploited by fraudulent claimants in the future.

The new benefit, Personal Independence Payment (PIP) will have tighter payout criteria than the current Disability Living Allowance (DLA).

Although many may lose out it is claimed that some of the more severely disabled will get enhanced benefits and that the mentally ill may also benefit from the changes.

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