UK welfare spending is forecast to rise by nearly £100 billion between the middle of this decade and the early 2030s, according to the Office for Budget Responsibility (OBR).
The Government is estimated to have spent £333.8 billion on welfare in 2025/26, equivalent to 10.9% of UK GDP. This total is projected to increase to £431.3 billion by 2031/32, a jump of £97.5 billion.
Where the welfare budget goes
Spending on pensioners takes up by far the largest share of the welfare budget, accounting for £161.4 billion of the total £333.8 billion in 2025/26, or nearly half. Universal credit, the main means-tested benefit which has replaced income support, jobseeker's allowance, housing benefit and tax credits, accounts for £92.8 billion, just over a quarter of total welfare spending.
The rest of the total is made up of disability benefits (£45.3 billion), child benefit (£13.4 billion) and other types of welfare, including social security in Northern Ireland which is administered separately (£20.8 billion).
Forecast rise and drivers
Welfare spending as a proportion of GDP is set to rise from 10.9% to 11.3% across the period. Spending on pensioners is forecast to pass £200 billion for the first time, rising from £161.4 billion to £209.8 billion by 2031/32. Universal credit spending increases from £92.8 billion to £110.7 billion, while spending on disability benefits rises from £45.3 billion to £69.6 billion.
The OBR identifies two main drivers of the increase. The first is higher spending on pensioners, due to the UK's ageing population and the "triple lock", which guarantees pensions will rise each year by whichever is highest: inflation, average earnings growth, or 2.5%. Of the forecast £97.5 billion extra spending in 2031/32, pensioners are responsible for just under half, at £48.4 billion.
The OBR notes the rise in the state pension age will be complete by March 2028, meaning it has no further downward impact on welfare spending from 2029-30 onwards. The next rise is expected between 2037 and 2039, "meaning the state-pension-age population and therefore pensioner spending is expected to grow significantly until then".
The second factor is the rise in people eligible for health and disability benefits. "High volumes" of new claims for health-related universal credit have pushed up the forecast. Universal credit accounts for £17.9 billion of the extra spending, while disability benefits, including disability living allowance and personal independence payments, make up £24.3 billion.
Health and disability benefits by age
Spending on all types of health and disability benefits in 2025/26 was estimated to be £85.6 billion, nearly three-quarters of which (£63.0 billion) went to working-age adults. Some £15.5 billion went to pensioners, while £7.1 billion went to children. Total spending is forecast to rise from £85.6 billion to £120.2 billion by 2031/32, passing £100 billion in 2028/29, one year earlier than previously forecast.
The OBR defines health and disability benefits as: the standard allowance and health element for universal credit claimants; employment and support allowance; incapacity benefit; severe disablement and disability living allowance; personal independence payment; attendance allowance; and support for carers, including carers allowance.
Outlook uncertainty
The OBR says there is "uncertainty" around the outlook, especially related to health and disability benefits "which have seen very significant rises in caseloads since the pandemic". The main forecast assumes cases will rise at a slower rate than earlier in the decade. However, if cases were to continue rising at the post-pandemic growth rate, "this could add around £25 billion to welfare spending by 2031/32". Alternatively, if cases slowed to pre-pandemic rates, spending could be around £13 billion lower by the end of this period.
