People with anxiety and milder depression face losing entitlement to disability benefit payments as Rishi Sunak set out a “moral mission” to reform welfare.

The prime minister said the recent rises in spending on sickness benefits were “obviously financially unsustainable” as he set out plans for wide-ranging reforms of the welfare system to change how it deals with such mental health problems.

After long-term sickness rose to a record 2.8 million, Sunak said that “something has gone wrong” since the pandemic and that too many young people in particular were being “parked on welfare”. He warned that “we risk not only letting those people down, but creating a deep sense of unfairness among those whose taxes fund our social safety net”.

Sunak has already been accused of “demonising” those with mental health problems after a speech in which he argued that the welfare system was “over-medicalising what are essentially the everyday challenges and anxieties of life”.

But he faced down critics who accuse him of lacking compassion, insisting: “There is nothing compassionate about leaving a generation of young people to sit alone in the dark before a flickering screen watching as their dreams slip further from reach every passing day.”

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