Background to the report

There are around 3.9 million working-age people currently receiving at least one of the principal disability benefits, including Employment and Support Allowance (ESA), Universal Credit (UC) and Personal Independence Payments (PIP). The Department for Work & Pensions (DWP) uses functional health assessments to help it assess whether people are eligible for these and a number of other benefits, and for a number of other purposes. DWP estimated in its 2021 Health Transformation Programme (the Programme) business case that the number of claims for these benefits in payment would increase from about 4.8 million in 2020-21 to about 5.8 million in 2025-26.

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DWP set up the Programme to improve the application and assessment process, which it views as vital to improve efficiency of the process and services for people claiming health and disability benefits. It started work in July 2018 and announced the Programme in March 2019.

The Programme is one of the largest transformation and service delivery programmes by value in government’s current portfolio. It is expected to run until 2029 and cost more than £1 billion. Through the Programme, DWP aims to make the assessment process “simpler, more user-friendly, easier to navigate, and more joined-up for claimants, whilst delivering better value for money for taxpayers”.

Scope of the report

This report provides an early assessment of the progress DWP is making with the Programme. Our report covers:

  • the baseline performance of functional health assessments
  • DWP’s approach to transforming functional health assessments
  • challenges implementing the Health Transformation Programme


The Programme is ambitious, and represents an opportunity to substantially improve the cost, timeliness and accuracy of functional health assessments while improving the experience for claimants and increasing the trust they have in the system. It is also the primary means by which DWP hopes to implement further reform of disability benefits, including removing the Work Capability Assessment, as set out in its recent white paper. While DWP draws on its experience in successfully delivering agile programmes and has put most of the required governance in place, transformation of this scale and complexity is inherently at high risk of time and cost overruns and not achieving all the intended benefits.

To date the Programme timetable has been driven by the length of contracts and the need to procure new contracts. There have already been delays both from the COVID-19 pandemic and its evolving commercial approach. There are gaps in DWP’s approach that it still needs to fill, particularly in terms of how it will integrate the service between providers, build an interim model that enables sufficient testing, and evaluate whether the Programme is on track to deliver the planned benefits.

DWP does not yet know how the reforms in the white paper it recently published will affect the Programme’s detailed costs, benefits and timetable, and it is likely the Programme will have to respond to further changes. Overall, there remain risks to value for money and these will need to be carefully managed for the Programme to realise the full benefits intended.


Publication details

Press release

View press release (23 Jun 2023)

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