MELBOURNE: More than 120,000 teenagers with autism, ADHD and depression are claiming disability benefits at a cost to the taxpayer of more than £1bn a year.

Data obtained by the inquiry shows 127,600 teenagers aged 16 to 19 are claiming personal independence payments (Pip), a non-means tested benefit designed to cover the cost of a disability, for these conditions in the past year. The average payment is £169 a week, or £8,800 a year, but payments can be worth up to £194 a week, or £10,119 a year.

Ministers are concerned the welfare bill is rising in part due to the NHS’s inability to keep pace with the mental health caseload, within a system that gives cash without any obligation for the state to provide — or the claimant to accept — the necessary support.

One former Department for Work and Pensions (DWP) minister told the inquiry this was “one of many problems” with the welfare system. “These kids want help, but they are getting cash instead,” they said. “The money we’re spending could actually get them the treatment they need, and do so quickly. But we can’t say what they should spend it on, the DWP doesn’t provide therapy and the NHS can’t fast-track welfare claimants. So these young people are falling down a gap in the system.”

The £1bn welfare bill is more than enough to pay for at least six counselling sessions for each of the 442,000 children waiting an average of almost ten months to be seen by NHS mental health services.

A mental health consultation typically costs the NHS close to £320, rising to £480 for specialist services. The cost of giving each child in the queue six therapy sessions, the standard course of treatment for mental health on the NHS, would be £251m less than was spent on Pip last year.

One Pip assessor told the inquiry the benefits money was not helping young people with mental health conditions. “In the last six months, I’ve only found a handful of 1times where somebody’s actually getting better,” they said. “Most people I speak to are just on waiting lists and are not using the payments to get any support. So things aren’t improving for them.”

Referrals of children to NHS mental health services in England have nearly doubled in six years. Most cases are usually seen within two weeks, but surging conditions such as autism join a much longer queue. The average wait for them is 42 weeks but about 44,200 children have been waiting for almost three years.

One in every 21 school aged children in England is in a months-long queue for mental health services.

Dame Rachel de Souza, the children’s commissioner, published a report this year on what she called the “crisis” of children’s mental health provision. She said: “These figures should be a wake-up call. We cannot ignore the sheer scale of distress young people are facing today — my recent research revealed, for the first time, more than a million children have an active referral to mental health services in England.

“Behind the data are children whose lives have been put on hold for months and, in some cases, years waiting for support they urgently need. The impact on young lives cannot be understated. Mental health is, for instance, one of the reasons more than 40,000 16- and 17-year-olds are severely absent from college, and effectively ‘hidden Neets’.

“The way we support young people’s mental health must change — we cannot address mental health in isolation, improving children’s wellbeing requires action across government with greater join-up and focus across health, education, and social care to ensure children are getting the help they need, when they need it, in schools and the community.”

The Pip assessor also said that, as a mental health nurse, they would rather help young people than sign them up to benefits.

Many Pip assessors are doctors or specialist mental health nurses, often giving them the expertise to deliver therapy or carry out autism assessments.

“We have a huge network of health professionals working for Pip who specialise in so many different things, and I don’t believe these assessments need to be carried out by those health professionals,” she said. “I feel like we’re not being used effectively. It feels like we could be doing the mental health assessments they’re waiting years for, to help the situation, rather than just assessing them for Pip.”

Alan Milburn, who was health secretary under Tony Blair, is conducting a review of rising youth unemployment. Almost a million young people in the UK aged 16 to 24 are not in education, employment or training (Neet).

His interim report said businesses must offer an “anxious generation” of young people greater flexibility and mental health support to encourage them into work.

“This is a bedroom generation,” Milburn said earlier this year. “They are sort of living in their bedrooms. They are on all the time, they’re never off. [Social media] is leading to some evidence of functional impairment, changing their sleep patterns, concentration levels. That is having an impact on their ability to work. They are not snowflakes. People say it’s a soft generation. My view unequivocally is that it isn’t. It is an anxious generation.”

The first Milburn interim report, published earlier this year, found that one in four Neets were signed off work with long-term sickness or disability. Some 43 per cent of them said mental ill health was their main condition.

Connie Muttock, head of policy at the Centre for Young Lives think tank, said: “Bringing mental health support to young people earlier — when they’re younger, when they first come forward to support, whether in school or in youth clubs — that is the biggest bang for your buck.

“The costliest thing that we can do is wait for mental health problems to escalate and wait for young people to feel like they have nowhere to turn and no options. I have no doubt that if we invested properly in a fully functioning mental health system that gets help to young people early and tackles the causes of children’s mental health, that we would have that benefits bill coming down significantly over a period of time.

“But it’s a result of that failure to invest that we have so many young people that aren’t in employment and are therefore on benefits.”

A government spokesman said: “The increase in the Pip caseload has slowed under this government, falling from 400,000 in the 12 months to July 2024, to 260,000 in the 12 months to July 2026.

“But as the Timms Review report made clear, Pip is no longer fit for purpose and the recommendations from its final report will lay the foundation for sustainable reform.

“We have also invested in mental health support in schools, colleges and communities, as part of a renewed focus on prevention and early intervention, to make sure that people receive the right help, at the right time — including responding to the findings from Professor Fonagy’s independent review.”