The Conservative Party proposes cutting Universal Credit by 30% after six months for claimants deemed fit to work who have not paid enough into the system. The reduced payment would be loaded onto a restricted "Back to Work" pre-paid card that blocks cash withdrawals and purchases of alcohol, tobacco and gambling. The party says the change could move about 350,000 people onto a 70% "subsistence" rate and save roughly £538m a year; charities and opposition parties warn it risks deepening hardship and leaves many questions about implementation.
Tories Propose 30% Cut To Universal Credit After Six Months, Load Reduced Payments On Restricted 'Back to Work' Card
[PA Media]
The Conservative Party has unveiled proposals to cut Universal Credit payments by 30% for some claimants who have been unemployed for more than six months and are judged fit to work but have not paid enough into the benefits system. The reduced payment would be loaded onto a government-issued pre-paid "Back to Work" card that would bar cash withdrawals and be coded to block purchases of alcohol, tobacco and gambling.
Conservatives say the measures are intended to encourage people back into employment and to reduce the rising welfare bill. The party estimates the change would move about 350,000 claimants on to a new 70% "subsistence allowance," saving roughly £538 million a year.
How the Scheme Would Work
Under the proposals, anyone assessed as fit for work would receive the full Universal Credit rate for six months to seek employment. Beyond that, entitlement to the full rate would be extended according to employment history: every two years previously worked would buy an extra year at the full rate. Those judged to have insufficient prior contributions would revert to the reduced subsistence allowance.
Conservatives say people with a strong employment record would be protected. For example, a 58-year-old who had been in stable work since leaving school but was then made redundant would, the party says, continue to receive the full allowance up to state pension age.
Card Mechanics And International Comparisons
The party says the 70% payment would be issued on a pre-paid card that prevents cash withdrawals and is programmed to block purchases of alcohol, cigarettes and gambling. Full operational details have not been published, but the Tory shadow welfare secretary, Helen Whately, described the card as "a version" of the Aspen pre-paid card currently issued to some asylum seekers in government accommodation.
The Aspen card can be restricted to prevent contactless, telephone or online payments and, in some circumstances, cash withdrawals. The Home Office has tightened the permitted retailer list after reports that some card holders used the cards at gambling arcades. The Conservatives also say they will study systems used in Australia, where benefit cards can be coded to block purchases at certain types of retailers.
Exemptions And Related Policies
The proposals would exempt people who are sick, disabled or already in work; only claimants judged capable of work would be affected. The Conservatives have also proposed other longer-term welfare changes, including tightening access to sickness benefits and restricting some Personal Independence Payments for lower-level mental health conditions to reduce spending.
Reactions
"The best welfare is a well-paid job. So, we will be tough on those who exploit the system because the current system is unfair to workers, taxpayers and those who truly need support," Conservative leader Kemi Badenoch said. "Welfare must be a safety net for those who genuinely need it, not a lifestyle choice for those who can't be bothered."
Helen Barnard, director of policy and research at the anti-poverty charity Trussell Trust, called the proposals "deeply misguided," arguing that Universal Credit already falls short of covering essentials such as food and heating and that cuts would deepen hardship and harm people’s ability to find and keep work.
Reform UK's economy spokesman, Robert Jenrick, said record numbers are already on long-term benefits and that the proposals would do little to reduce the overall welfare bill.
Government figures from the Department for Work and Pensions show benefit spending has grown in recent years and is forecast to reach £408.6 billion by 2030/31. Labour figures have said they want to tackle the welfare bill through measures such as helping young people into education, employment or training, but have warned against "crude cuts" to essential support.
What Is Still Unclear
Key operational questions remain unanswered: how the government would administer and enforce retailer blocks, how appeals and exceptional circumstances would be handled, and how the policy would interact with existing support for people with fluctuating health or caring responsibilities. The Conservatives have not published full implementation details or a legislative timetable.
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