Milburn review proposes cutting benefits for under-25s and boosting employment support

A government-commissioned review headed by former Labour health secretary Alan Milburn is set to recommend a major overhaul of welfare for people aged 18 to 24. The year-long report, due on Tuesday, proposes removing the health element of universal credit and personal independence payment for under-25s and replacing them with a basic-rate allowance. Some claimants could qualify for an additional cost allowance to cover daily expenses linked to their conditions, but many would receive less financial support initially.

Milburn told the Times the changes would not be "pain-free" and would affect both existing and new claimants. He argued that the current system "prioritises the latter over the former" – favouring short-term finances over long-term life chances – and said the priority should be reversed.

The review also suggests investing billions in employment support for young people, including work placements, job subsidies and one-to-one advisers. Those with severe disabilities who cannot work would receive a new, higher-rate benefit.

Data from the Office for National Statistics shows just under one million young people in the UK are classified as NEET, a 3% rise from the previous year. A government spokesperson said a safety net will remain for the most vulnerable, adding that the prime minister has called for a "wholesale change" in how young people are supported.

If adopted, the reforms could take up to a decade to generate savings and would require substantial investment to rebuild the system from scratch.