Benefits claimants in Britain are receiving an additional £10billion in “hidden” benefits on top of Universal Credit payments in excess of £100billion, a recent study has revealed.
The “bonus” benefits from the Department for Work and Pensions (DWP) include free prescriptions, travel and school meals, helping with energy, water, broadband and holiday bills.
According to the think tank Onward, these are automatically available to families claiming Universal Credit.
The think tank said the additional benefits were handed out in “uneven” and “opaque” ways, and disincentivised claimants from finding work.
More than half of those on Universal Credit now have no requirement to work (4,174,256 as of December 2025).
This means many of the benefits are cross-subsidised by working families instead, who are facing higher taxes and increased energy bills.
The biggest “hidden” benefit is council tax support. This costs the UK an estimated £3.2billion for nearly 2.3 million claimants of working age.
Free medical prescriptions are the next largest benefit. This cost the UK £1.4billion with more than 120 million claimants.
The Department for Work and Pensions projects 4.2 million adults will be claiming PIP by 2030
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GettyFree dental care costs a further £355million, for 3.7 million courses of treatment.
Providers do not receive additional government funding for some of the discounts and extra services they are legally required to offer benefit claimants.
Shadow Welfare and Pensions Secretary, Helen Whately, said “our welfare system isn’t working”, and the “hotchpotch of benefits outside Universal Credit undermines its purpose to make sure work always pays”.
“Welfare needs urgent reform, but instead the Government is adding extra handouts and making the problem worse,” she added.
“We need a fairer welfare system which backs people who do the right thing, and serves as a safety net, not a benefits trap.”
Onward’s research revealed the “vast shadow welfare system” of “passported” benefits for the first time.
These are defined by free or subsidised services that are automatically unlocked through Universal Credit claims.
The report detailed: “The additional payments that claimants can receive because of their eligibility for their regular benefits are rarely included in analyses of how and why spending on working-age welfare has become so out of control.”
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