LIVERPOOL -- Catherine Wieland got on Britain's welfare rolls in 2021. With a history of emotional trauma, she was too anxious to go outside or carry out simple tasks like washing herself, she told the government.
Soon, she was receiving about GBP700, or $1,000, a month in disability benefits. And, it turns out, going outside quite a bit.
Using a taxpayer-subsidized program for those with disabilities, Wieland paid a small deposit for a free BMW, which she used to regularly visit the hair salon, dine out at restaurants, attend a Brighton pride parade and visit an amusement park. According to court reports in her fraud conviction, she also flew to Cancún, Mexico, where she posted pictures of herself ziplining and riding a quad motorbike.
Wieland's case is an extreme example of a new reality in the U.K.: Disability payouts are no longer just for those most in need; they have become a financial crutch for a large swath of the population as wages stagnate and prices rise.
It's blowing up Britain's welfare bill, hamstringing its politicians and imperiling its long-term financial stability.
Some seven million people -- more than 10% of the population -- now claim at least one or more sickness or disability benefits. The numbers are growing fastest among working-age people who should be powering the country's economy, surging more than 60% in the past six years to 4.7 million from 2.9 million in 2019.
Not including healthcare, the country will spend more than GBP100 billion this year on all types of welfare benefits for the sick and disabled, about a third more than defense spending. The tab has surged by a quarter in just four years and is on course to hit GBP130 billion in the next four, according to the government's fiscal forecasts.
Many of the newer disability claims are for mental-health issues like depression, anxiety and ADHD, which can be harder for the government to verify than a physical disability. Between 2017 and 2025, disability claims for cancer doubled. But benefits claims for all psychiatric issues surged fourfold.
One benefit, created to help those with disabilities be more mobile, allows people to give up part of their welfare cash handout in return for a new car every three years. It now accounts for around one in every seven new car sales in the U.K. Among those who got new cars last year: 40 people whose primary medical condition was tennis elbow, 50 with wheat intolerance and 320 with dyslexia, according to government figures.
The scale of the payout has become a scandal. No other western country has seen such a rise in disability claims. In the U.S., the number of people getting federal disability payments has fallen in the past 15 years. The most recent figures show some 10.6 million working-age people in the U.S. claimed one or both main Social Security programs for people with a disability, in a country with a population five times bigger than the U.K.
It's also a litmus test of a pressing question facing the West: Is it possible for political leaders to rein in spending on ever expanding welfare states?
So far, the answer seems to be no, increasing the chances that countries like Britain are inching toward a financial reckoning.
'Clearly not sustainable'
The U.K., like its European peers, is caught in a vicious cycle.
Its spending is surging thanks to an aging population, greater defense needs, a costly green-energy transition and the swelling bill for welfare and debt interest. But its income is mostly flat, with weak economic growth.
The government has raised taxes and binged on debt, borrowing an extra GBP1 trillion since the pandemic. That strategy is running out of road.
U.K. borrowing costs are higher than any country in the Group of Seven, recently hitting their highest level since the 2008 financial crisis. A slow but steady exodus of wealthy Brits leaving for tax-friendly locales like Dubai has shown there are limits to how much the government can keep raising the tax burden, which is already at its highest level since World War II.
The surge in welfare spending is "clearly not sustainable on any level," says David Coombs, head of multiasset investments at U.K. fund manager Rathbones. "It really is the big issue of the moment, and the bond markets reflect that."
Borrowing costs on Britain's 10-year bonds have risen to 5.5% from 4.5% at the start of the year, adding a few extra billion pounds to the country's running costs. The U.K. is paying more for its debt than spendthrift France or historical basket cases like Greece.
But across Europe, attempts to change the social safety net -- now considered a birthright even as it becomes a fiscal albatross -- is proving politically toxic.
In France, attempts to trim spending on entitlements led the National Assembly to oust two previous prime ministers. Spain reversed a previous overhaul to trim its pension system. After Germany passed some modest changes to its unemployment and health benefits, furious voters have punished the ruling center-right party.
In 2025, then U.K. Prime Minister Keir Starmer announced plans to tighten eligibility requirements for sickness and disability welfare in a bid to shave GBP5 billion a year off government spending by 2030.
The backlash was so sharp Starmer abandoned the cuts. Investors, spooked that a government with a big majority couldn't push through such a reform, sold off British government bonds, the pound fell sharply and the Chancellor of the Exchequer cried in Parliament.
Starmer was later ditched by the Labour Party, replaced this summer by the telegenic Andy Burnham, who has also pledged to deal with welfare -- but not through what he calls "crude cuts."
Burnham will unveil his first budget later this month and is widely expected to include fresh tax hikes, which could put Britain's finances on firmer footing but will further crimp economic growth.
A debate about welfare is raging in the party -- captured by Pat McFadden, one of Starmer and Burnham's top aides. In a leaked WhatsApp message last year, McFadden complained that every meeting he had with Labour lawmakers was about "Who can we tax in order to pay benefits to others?"
McFadden, who oversees the department in charge of handing out welfare, has promised changes to the system. Burnham's own long-term vision is an unabashedly socialist overhaul -- and expansion -- of the state, even as he's acknowledged the fiscal challenges.
If the British government wants to gain investor trust and lower borrowing costs, it needs to show it can make politically painful spending cuts to areas like welfare, says Andy Haldane, a former chief economist at the Bank of England and ex Burnham adviser.
"The fiscal Achilles' heel of this government thus far has been its unwillingness and/or inability to cut public spending," he says. "The market now suspects that this is a traditional tax-and-spend socialist government with better TikTok videos."
Mission creep
Across the European Union, government welfare spending has steadily grown from just 10% of economic output in the early 1960s to an average of 27% today, compared with about 21% in the U.S.
Disability and sickness payments in the U.K. show how the system sprawls.
Britain's postwar government introduced disability payments to help offset lost wages for, say, a worker who lost a hand in an industrial accident. But over time, the system grew into an alphabet soup of programs. Some are aimed at people who are too sick to work. Others are broader: Personal independence payments are a cash handout for anyone -- rich or poor, working or not -- who has an illness or disability to help cover higher living costs.
PIP was meant to help with things like modifying homes or cars for wheelchair access. When the benefit's precursor was created in the 1990s, the government thought a few hundred thousand would claim. Today one in every 12 people is getting disability checks. The program now covers people living with a range of physical and mental health issues, including anxiety, ADHD, depression and even acne.
"I think people broadly agree the system is now doing things it was not intended to do," says Paul Johnson, an expert in fiscal issues at the University of Oxford. "It's not immediately clear, for example, why someone with depression or anxiety necessarily has higher living costs."
In deprived areas, particularly former industrial centers like Liverpool, a significant number of residents depend on welfare. In Walton, a Liverpool suburb that ranks as one of Britain's most deprived neighborhoods, around 1 in 2 households claim welfare, and 1 in 5 working-age residents claim PIP.
"People aren't working around here because they can get on PIP, so they sit around and do drugs and drink," says Stephen Walker, a 65-year-old drummer who helps manage a Beatles memorabilia store, as he strolls through Walton on a recent day. "It's unfair. I work and pay my taxes."
Walker acknowledges some people do need the help -- including three of his grandchildren, who are on PIP. But he says too many people just use it to top up their income and don't get jobs.
Charities say the welfare payments are a relief for people who've seen food and heating costs soar in recent years. Britain's Conservative government in the 2010s cut unemployment benefits to try to spur people back to work, but it ended up causing extra hardship at a time of weak economic growth. People started claiming disability benefits instead.
"People don't just come in and go, oh, you know, 'Jackpot. I've got an ADHD diagnosis. Gimme, gimme, gimme.' It doesn't work like that," says Mick Blakeley, head of operational development at Citizens Advice Liverpool, a charity that offers advice on issues like claiming benefits.