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Study estimates mental health impact of welfare reform

Published: 28 February 2020

A nine-year observational study has linked roll out of Universal Credit across England, Wales, and Scotland with an increase in mental health problems among unemployed recipients.

Universal Credit was launched in April 2013, replacing six existing benefits, and was planned to simplify the benefits system and help more people into work. By the end of the roll out in 2018, 1.6 million people were receiving Universal Credit in England, Scotland and Wales, including 73% of unemployed people (990,000) 

This nationally representative study, which was supported by the NIHR School for Public Health Research and the NIHR Applied Research Collaboration North West Coast, followed more than 52,000 working-age individuals from England, Wales, and Scotland over nine years between 2009–2018. 

The results, published in the Lancet Public Health, showed that the introduction of Universal Credit across the UK was associated with a 6.6 percentage point increase in mental health issues among recipients, compared with a comparison group who were in employment or retired.

The study estimated that between April 2013 and Dec 21 2018, an additional 63,674 unemployed people experienced levels of psychological distress that are clinically significant due to the introduction of Universal Credit, over a third (21,760) of whom might reach the diagnostic threshold for depression

 “Our study suggests that the introduction of Universal Credit led to an additional seven people experiencing psychological distress for every 100 people affected by the policy, and supports growing calls for Universal Credit to be fundamentally modified to reduce these mental health harms”, says Dr Sophie Wickham from the University of Liverpool, who led the research.  

Further analyses suggested that Universal Credit did not appear to affect the physical health of unemployed recipients. They also found no evidence that the welfare reform was associated with more people entering employment.


Professor Ben Barr, lead of the Improving Population Health research theme at the NIHR Applied Research Collaboration North West Coast, said: “Our findings have international importance for health professionals who are responding to the rising mental health needs of populations and for policymakers weighing up the costs and benefits of changes to welfare policies.” 

The researchers findings show observational associations rather than cause and effect, and the increase in mental health cases could have been influenced by the broader range of welfare changes. They note several data and methodological issues that might affect the accuracy of the estimates, including that unemployment and mental health were based on self-reported data. 

Read more on the University of Liverpool website.


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