Starmer makes U-turn in bid to head off Labour welfare revolt

The Herald Scotland

3 days ago

Some 126 Labour backbenchers had signed an amendment that would halt the Universal Credit and Personal Independence Payment Bill in its tracks when it faces its first Commons hurdle on July 1.
Rebels now believe the concessions on offer, which include protecting personal independence payments (Pip) for all existing claimants, will be enough to win over a majority.
Asked on Friday morning whether the Government now expected the Bill to pass, health minister Stephen Kinnock told Times Radio: 'Yes.'
The Government's original package had restricted eligibility for Pip, the main disability payment in England, and cut the health-related element of Universal Credit, saying this would save around £5 billion a year by 2030.
Now, the changes to Pip eligibility will be implemented in November 2026 and apply to new claimants only while all existing recipients of the health element of Universal Credit will have their incomes protected in real terms.
The changes represent a major climbdown for the Prime Minister, just days after he insisted to reporters he would 'press on' with the cuts, arguing there was a 'moral case' for them.
Work and Pensions Secretary Liz Kendall confirmed the U-turn in a letter to MPs late on Thursday night, along with plans for a review of the Pip assessment to be led by disabilities minister Sir Stephen Timms and 'co-produced' with disabled people.
A Number 10 spokesperson said: 'We have listened to MPs who support the principle of reform but are worried about the pace of change for those already supported by the system.
'This package will preserve the social security system for those who need it by putting it on a sustainable footing, provide dignity for those unable to work, supports those who can and reduce anxiety for those currently in the system.'
Dame Meg Hillier, one of the leading rebel voices, described the concessions as 'a good deal' involving 'massive changes' to protect vulnerable people and involve disability people in the design of future reforms.
Work and Pensions Secretary Liz Kendall confirmed the U-turn in a letter to MPs late on Thursday night (Ben Whitley/PA)
She said: 'It's encouraging that we have reached what I believe is a workable compromise that will protect disabled people and support people back into work while ensuring the welfare system can be meaningfully reformed.'
Not all the rebels have been satisfied with the changes, with several suggesting they would create a 'two-tier system' and raising questions about who would be classified as a new claimant after November 2026.
Another told the PA news agency the U-turn would probably be enough to see off the rebellion, but warned that discontent and low morale among the backbenches would 'continue to fester' without a 'wider reset' of relations between Number 10 and the Parliamentary Labour Party.
The concessions could also leave Chancellor Rachel Reeves scrambling to fill a hole in her budget come the autumn, with the Institute for Fiscal Studies suggesting they could reduce the projected savings by at least £1.5 billion per year.
Ruth Curtice, chief executive of the Resolution Foundation think tank, suggested the changes could cost as much as £3 billion and raised the prospect of further tax rises.
On Friday morning, Mr Kinnock declined to be drawn on how that reduction would be covered, saying it was 'very much the Chancellor's job as we move into the budget in the autumn'.
He also declined to comment on whether it was fair that two people with the same condition would receive different amounts of money depending on when they started their claim.
Mr Kinnock told Times Radio there were 'many different individual circumstances' and it was 'not possible to generalise'.
There was a mixed reaction among charities to the prospect of concessions.
Learning disability charity Mencap said the news would be a 'huge relief to thousands of people living in fear of what the future holds'.
Director of strategy Jackie O'Sullivan said: 'It is the right thing to do and sends a clear message – cutting disability benefits is not a fair way to mend the black hole in the public purse.'
The MS Society urged rebels to hold firm and block the Bill, insisting any Government offer to water down the reforms would amount to 'kicking the can down the road and delaying an inevitable disaster'.
Charlotte Gill, head of campaigns at the charity, said: 'We urge MPs not to be swayed by these last-ditch attempts to force through a harmful Bill with supposed concessions.
'The only way to avoid a catastrophe today and in the future is to stop the cuts altogether by halting the Bill in its tracks.'
The Tories described concessions as 'the latest in a growing list of screeching U-turns' from the Government.
Shadow chancellor Mel Stride said: 'Under pressure from his own MPs, Starmer has made another completely unfunded spending commitment.
'Labour's welfare chaos will cost hardworking taxpayers. We can't afford Labour.'