Government schemes could save UK over £20 billion by getting 5% back to work
Published: 15 October 2025
The Government could save upwards of £20 billion and support more than 220,000 people back into employment through return-to-work schemes, according to new analysis involving the University of Glasgow.
The report models the potential effectiveness of the Government’s ‘Getting Britain Working’ programmes, showing these savings could be made by the end of this Parliament in 2029 if just 5% of out-of-work people in receipt of Universal Credit returned to work.
The report estimates that:
- Getting 5% of unemployed under-25s back into work would save £903 million.
- Getting 5% of under-25s workless due to sickness or disability back into work would save £631 million.
- Getting 5% of unemployed over-25s back into work would save £6.67 billion.
- Getting 5% of over-25s workless due to sickness or disability back into work would save £11.9 billion.
The 5% estimate is based on what happened with the similar New Deal initiatives that happened in the UK in the 2000s. Savings would be made in the form of both reduced benefits spending and increases in tax and national insurance revenue.
The costs to Government of assisting this number of people back into, and helping them stay in, employment could be between £1.5 to £1.9 billion. So that within just two years, the Government could save almost £10bn, meaning every £1 invested in employment support programmes could return between £5.21 and £6.63.
Currently, more than five million people in the UK are out of work and in receipt of Universal Credit - including almost one million people aged 18-24 years who are not in education, employment or training (NEETs). 1 in 5 of these young people receive health-related benefits largely for mental health conditions. Ill-health related economic inactivity accounts for over three million claims and is particularly concentrated in the most deprived and deindustrialised areas. As of May 2025, the average household on Universal Credit received £961.63 per month in England.
The report was commissioned and funded by the Work and Pensions Select Committee and produced by Health Equity North with academics from Newcastle University, The University of Manchester, University of Liverpool, and University of Glasgow.
The report has been submitted as evidence to the Government’s Work and Pensions Select Committee, which looks into the policies and spending of the DWP, including benefits for people both in and out of work.
Professor Clare Bambra, Academic Co-director of Health Equity North and Professor of Public Health at Newcastle University, said: “Constituencies such as East Marsh and Port, Grimsby, Central Easterhouse, Glasgow and Birkenhead Central have around 30% of the working-age population receiving ill health-related welfare benefits. In these areas, life expectancy is 12 years less than the national average. This stark inequality reflects the deep connections between health, work, and place - where decades of industrial decline and underinvestment have left communities struggling with poor health, limited opportunities, and persistent economic disadvantage.
“By embedding employment support within health services and targeting investment where ill health and unemployment overlap, we have a real opportunity to break this cycle. Helping even a small proportion of people in these areas back into good, secure work could have transformative effects - not just for the government and local economies, but for people’s health, wellbeing, and prosperity.”
Dr Andy Baxter, Research Associate at the University of Glasgow, said: “Employment is one of the strongest determinants of health. When people are in good, secure work, they’re less likely to experience long-term illness, more likely to engage with preventive healthcare, and more connected to their communities. Reducing economic inactivity through health-focused employment programmes provides stability, purpose, and the foundation for healthier, fairer futures. Effective back-to-work schemes are crucial in rebuilding a Britain that is healthy and prosperous, and our research shows that the return on investment potential is huge.”
Read the full analysis: Estimating the savings and financial benefits to the UK government of return-to-work for people in receipt of Universal Credit
First published: 15 October 2025
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