New research has found that spending on benefits for working-age people exceeded investment in key infrastructure, such as schools and trains, by £1.1 trillion between 2006 and 2025. The Centre for Social Justice (CSJ) reported that disability support and other welfare forms amounted to £1.1 trillion more than capital expenditure during this period.
Researchers warned that welfare spending has been used to “compensate for weak local economies,” a reversal of trends observed after World War II. A 250-page report indicated that benefits spending, which was 2.5 per cent of GDP between 1949 and 1975, rose to about five per cent between 1975 and 2016.
Currently, benefits spending is approximately 4.6 per cent of GDP, while public investment is at 2.9 per cent. Ben Gregg, head of welfare at the CSJ, stated that governments have chosen to “compensate struggling regions for decline rather than reverse it,” advocating for re-wired spending priorities to boost incomes.
The findings, which converted historical figures to 2026 prices, contribute to calls for a reassessment of the UK's welfare state design. Labour ministers are expected to consider proposals following the Alan Milburn review into youth unemployment and the Sir Stephen Timms review into personal independence payments.