Labour MPs have warned that the Government has not done enough to head off a rebellion from backbenchers over its proposed welfare reform plans.
Concerns grew on Sunday about the scale of disability benefits cuts that are expected to be laid out next week despite the Department for Work and Pensions making concessions to MPs.
Work and Pensions Secretary Liz Kendall is expected to announce legislation to introduce a “right to try guarantee” that will prevent people receiving health-related benefits from having their entitlements automatically re-assessed if they enter employment.
And ministers are also said to be reconsidering plans to freeze Personal Independence Payments (PIP) following significant backlash from within Labour.
The proposal was set to form part of Chancellor Rachel Reeves’ plans to make up to £6bn of savings to the growing welfare bill ahead of her Spring Statement on 26 March.
The plan – to cancel inflation-linked rises to PIP – was something that George Osborne avoided as chancellor during austerity as critics say it would result in real-term cuts to benefits for those who are unable to work.
However, the Government is said to be considering dropping this proposal following widespread backlash from across the political spectrum.
One Labour MP told The i Paper: “There’s a lot of disquiet among Labour MPs over the proposals.
“Personally, I sympathise with the need to cut the welfare bill, but targeting PIP isn’t the right way.”
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They added: “I’ve heard a lot of colleagues say that this feels like a Tory approach, not a Labour policy. It doesn’t sit right with a lot of us.”
Ministers are also expected to announce major changes to the eligibility criteria for PIP, making it harder to claim, and changes to employment support for those too sick or disabled to work.
Other expected changes include scrapping the work capability assessment, which determines whether people receiving universal credit are fit for work.
The Joseph Rowntree Foundation said the plans would be the biggest cut to disability benefits since the Office for Budget Responsibility was created in 2010, with Labour fearing a major rebellion over the issue, though whips have disputed claims that up to 80 MPs could defy the party.
Reeves was reportedly challenged during a cabinet meeting last week over her approach to slashing welfare amid speculation that proceeding with the plans could lead to ministerial resignations.
Labour MPs were invited en masse to Downing Street for what was described as a “welfare roundtable” to discuss the expected cuts to benefits.
But one backbench MP said that this approach had not assuaged the concerns of many members that they were being kept in the dark about the full extent of the plans.
They added that there was “definitely a sense among MPs, even those supportive, that there hasn’t been good enough communication from No10 about the plans”.
Benefits: The numbers
Almost four million working-age adults in England and Wales currently claim incapacity or disability benefits, up from 2.8 million before the pandemic. Downing Street has warned that without action, benefits will “swallow more taxpayers’ money and leave more people trapped in a life of unemployment and inactivity”. According to the Department of Work and Pensions’ (DWP) own figures, there were 15,300 monthly awards of the disability benefit PIP (Personal Independence Payment) on average in 2020/21. This has since grown to 35,100 awards on average a month – an increase of 129 per cent. This equates to around 1,154 awards of PIP a day. DWP figures also outline there were 250,000 registrations for new PIP claims between February and April 2023, 210,000 between May and July, and 230,000 between August and October. Figures for November to January 2024 will be published later this month. Not all of these were successfully awarded but this equates to around 920,000 applications each year. This means overall PIP spending is forecast to hit £21.8bn in 2024/25, up from £13.7bn in 2020/21.With the Government expected to release more details on its plan to cut the welfare bill in the coming week, some in the party fear the fuller details will only contribute to the growing disquiet.
“I think it’s very likely that more colleagues will make their opposition known over the coming week. I’m not sensing a rebellion, but the anger is much stronger than I think No10 realises,” another Labour MP said.
The backlash was likely to be fuelled by comments from Health Secretary Wes Streeing, who argued on Sunday that there had been an “overdiagnosis” of mental health conditions, which had led to a sharp increase in claims for PIP.
“There’s too many people being written off and, to your point about treatment, too many people who just aren’t getting the support they need,” he said.
“So if you can get that support to people much earlier, then you can help people to either stay in work or get back to work.”
Responding to Streeting’s comments, mental health charity Mind said it was important to be “extremely careful” with the language around mental health diagnoses to avoid “stigmatising people’s real experiences”.
Former Labour shadow chancellor Ed Balls said on his Political Currency podcast that cutting disability benefits was “not a Labour thing to do”.
The influential Labour figure, who is married to Home Secretary Yvette Cooper, also suggested that the plans were “not going to work” if the goal was to get people back into work.
Responding to criticism of the approach, Streeting told the BBC’s Sunday with Laura Kuenssberg that Kendall wanted “to support people who need help the most” as he pointed to DWP figures showing that the number of working age people now receiving PIP in England and Wales has more than doubled since the pandemic.
According to the DWP, there are 35,100 awards of PIP on average a month – an increase of 129 per cent since 2021 – equating to around 1,000 people a day.
“We’ve got to make sure that there is a wider range of support and that everyone’s playing their part, including me – for example if I can help people back to health, in many cases, I’ll be helping them back to work – and that’s what we’ll do,” Streeting said.
“I haven’t seen the proposals but you’ve seen the briefing, you’ve seen the speculation, I think the moral of the story is wait for the plans.”
Asked about Labour’s welfare plans during a press conference on Saturday, Sir Keir said: “I have made the principles clear enough. We need to support those who need support, and to protect them.
“But at the same time we need to make sure that we support and protect those who need to and are able to get into work, which the current arrangements I don’t think adequately do.
“That’s why it’s important we make the case for reforming welfare, which is what we are doing.”
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