DWP warns 300,000 people are missing out on Universal Credit benefits

Skills England chair Phil Smith told MPs that around 300,000 young people are not on benefits, with DWP working to address youth unemployment and skills gaps

Senior DWP officials have drawn attention to a substantial issue where many thousands of individuals are not receiving any payments whatsoever. The comments came as departmental leaders appeared before MPs to discuss their work in tackling the problem.

High-ranking figures from Skills England outlined their initiatives to boost employment levels during a session with the Work and Pensions Committee. Skills England is a newly established Government body formally launched in June 2025, created to bring together programmes that improve people’s capabilities, create additional employment opportunities and thereby drive economic expansion.

The organisation initially sat within the Department for Education but was transferred to the DWP in September 2025.

One question put to the panel related to their strategies for getting young people into work, with the figure for young people not in education, employment or training nearing one million. The committee asked: “What issues in the skills system might be contributing to that, and what is your body doing to address that?”

Phil Smith, chair of Skills England, recognised this is a “complex” challenge to address, but pointed out that this group isn’t simply composed of jobless individuals claiming benefits. He said: “Around 300,000 people, I understand, are not even on benefits. That is 300,000 people who are not sitting and sponging off the state, as people like to say – they are actually not on benefits.

“They are just not anywhere. That is really bad.” Failing to claim benefits to which you are entitled could result in a significant loss of income, reports the Mirror.

Are you entitled to more DWP payments?

Anyone aged 18 or over is eligible to apply for this means-tested benefit. Those aged 16 or 17 may also qualify under certain circumstances, such as having a health condition or disability, or providing care for someone in receipt of a health or disability-related benefit.

Through the benefit, households can receive one standard allowance, which pays £338.58 a month for single claimants aged under 25, or £528.34 for a couple where both are under 25.

The standard amount rises for those aged 25 and over, paying £528.34 a month for single claimants and £666.97 for couples where both are aged 25 or over.

Mr Smith outlined the steps his organisation is taking to address youth unemployment. He said: “We have announced a series of foundation apprenticeships and so on, so capabilities are there. However, by far that is not job done.

“We must make the system relevant for people where they are at that time – how they get pathways and on to these things.” The DWP also recently provided an update on its plans to increase funding for its Youth Guarantee and the Growth and Skills Levy.

DWP grant funding

This initiative promises to provide assistance to one million young people, generating 500,000 opportunities for training and work. DWP minister Andrew Western told Parliament: “The Government is taking action to support employers to recruit and train young people, helping to unlock up to 200,000 more employment opportunities.

“This includes a new £3,000 Youth Jobs Grant for employers who hire 18 to 24-year-olds who have been on Universal Credit for over six months, a new £2,000 apprenticeship incentive for small and medium-sized employers hiring 16 to 24-year-old, and the Jobs Guarantee scheme, providing long-term unemployed 18 to 24-year-olds with a fully funded six month job.”