A new government fund worth up to £60 million is being launched to test innovative ways of improving employment opportunities for disabled people and those with long-term health conditions.
The Department for Work and Pensions has published new guidance for the Pathways to Work Innovation Fund, with the first funding round expected to open in September.
Up to £10 million will be available during the first round, with a further £50 million expected to be offered through a second round opening in early 2027.
The fund forms part of the government's wider £3.5 billion Pathways to Work investment.
New ideas to close the disability employment gap
The Innovation Fund has two main aims: helping disabled people and people with long-term health conditions move towards, enter, remain in and progress through work, and building evidence about which approaches are most effective.
Funding will be used to test new services, technologies, partnerships and models of employment support that could potentially be expanded elsewhere if successful.
The DWP says proposals could include new uses of technology, new services or interventions, different delivery models and partnerships that bring employment, health and skills support together.
Projects designed to help employers provide better support for disabled people and people living with long-term health conditions will also be eligible.
Employers and charities can apply
The fund will be open to organisations from the public, private and voluntary sectors across the UK.
Applicants must be based in the UK and will be expected to demonstrate that their proposal offers a genuinely new or significantly different approach rather than simply extending an existing service.
Applications are currently expected to open in September and close in October, with shortlisted organisations receiving decisions from early 2027. Full application criteria are due to be published shortly.
The government says application information will also be made available in accessible formats including large print, Easy Read, British Sign Language, audio and Welsh.
Focus on what works
An important element of the initiative will be gathering evidence.
The government wants successful projects to provide lessons that can be replicated or scaled up, rather than funding isolated programmes without a wider impact.
An advisory panel has been appointed to help shape the fund and assess shortlisted proposals.
Members include representatives from the Business Disability Forum, Mencap, The Valuable 500 Foundation and Channel 4, alongside Paralympian Baroness Tanni Grey-Thompson and experts in employment, technology and public services.
The involvement of people with professional and lived experience of disability is intended to help ensure projects reflect the realities faced by disabled people in the labour market.
Opportunity for employers to rethink workplace support
The programme could also encourage employers to examine how recruitment, workplace adjustments, progression and job design affect disabled employees.
Closing the disability employment gap is not simply about helping more people secure their first job. Retention, career development and the ability to progress into more senior positions are also central to creating genuinely inclusive workplaces.
The first round of the Pathways to Work Innovation Fund is expected to make up to £10 million available from September 2026.
Source: Department for Work and Pensions, Pathways to Work Innovation Fund guidance, published 27th August 2026.