How is the welfare budget spent?

In the financial year 2014/15, the UK government spent £258 billion on welfare, which made up 35% of all government spending. In the financial year 2010/11 the government spent £230 billion on welfare, around 33% of government spending.

How do you think this was split?



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How much do we spend on welfare for retired people?

Welfare covers a number of benefits, and many people don’t realise that the largest amount is actually spent on pensions at £108 billion.

Total pension spending has increased by 25% since the financial year 2010/11. This isn’t surprising as life expectancy has been steadily increasing, so state pensions are being claimed for longer. The remaining life expectancy for someone aged 65, in 2016, is 21 years for a man and 24 for a woman. To find out how long your pension pot might need to last, check out our interactive here.

How much do we spend on care?

£29 billion is spent on personal social services. About £41 billion goes on benefits for people who are ill or disabled, while £10 billion goes on elderly care payments. Disabled people are more likely to live in deprived areas and work in routine occupations. In the 2011 Census, 18% of people (10 million) reported some form of disability.

As for elderly care, there were 9.2 million people aged 65+ in 2011, making up 16% of our population. The care home population has actually stabilised over the last decade at around 300,000 people, but there has been an increase of 600,000 people (likely family members) providing unpaid care between 2001 and 2011. In total, 5.8 million (10%) provided unpaid care in England and Wales in 2011, and the majority were of working age.

How much do we spend on working age people?

£44 billion goes on family benefits, income support and tax credits. This includes benefits such as child benefit and support for people on low income. Around £3.5 billion goes to the unemployed.

There were around 3 million people in in-work poverty in 2013. This meant their household income (adjusted for household size and composition) was below the poverty threshold and were in employment themselves. The ten per cent of households with the lowest disposable income spent an average of £196 a week in 2013. Of this, half (£98) was spent on food and non-alcoholic drinks, transport, housing (including net rent), and household fuel and power.

As for out of work people claiming Jobseeker’s Allowance and Universal Credit, there were 760,200 people claiming these benefits in January 2016. This number has decreased by 11.2% compared with a year earlier.

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