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Liz Kendall, the welfare secretary, has set out proposals to cut £5bn from the welfare budget – which she has said is “unsustainable” and “trapping people in welfare dependency”.

Disabled people claiming PIP, the personal independence payment which helps people – some of them working – with the increased costs of daily living, face having their awards reviewed from the end of next year.

An estimated 800,000 current and future PIP recipients will lose an average of £4,500 a year, according to a government assessment.

Ministers say 90% of current claimants will not lose their benefits; and that many people will be better off.

To keep the benefit, claimants must score a minimum of four points out of eight on one of the daily living criteria.

Ministers say claimants with the most serious conditions, who cannot work, will not face constant reassessments.

A £1bn programme is proposed, intended to give disabled people who can work tailored support to find jobs.

The Work Capability Assessment (WCA), which determines if a person is fit for work, will be scrapped in 2028, with financial support for people who are sick or disabled determined solely through the PIP assessment.

Ms Kendall described the current WCA system as “complex” and “time-consuming” for people trying to apply.

The government also intends to freeze the health element of Universal Credit, claimed by more than two million people, at £97 a week during this parliament, and cut the rate to £50 for new claimants.

Other reforms include:

• Merging jobseeker’s allowance and employment and support allowance;
• Raising the standard universal credit allowance by £775 in 2029/30;
• Introducing a “right to try” initiative so people who want to attempt to get back into work won’t lose their benefits while they do.