DWP welfare cuts to result in 150,000 in poverty - despite major U-turn
Around 150,000 people will still be pushed into poverty under the government's proposed welfare cuts, new modelling suggests.
It comes despite a major U-turn by Keir Starmer last week to water-down the policy after a massive Labour revolt threatened a Commons defeat.
In a dramatic climbdown on Thursday, the PM agreed to protect all existing claimants from losing Personal Independence Payments.
The changes to PIP will now only apply to new claims from November 2026.
But new modelling published by the Department for Work and Pensions today says an additional 150,000 individuals will be in relative poverty after housing costs by the end of 2029-30.
A previous analysis - before the concessions - said the reforms would result in an extra 250,000 people, including 50,000 children, would fall into poverty.
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Spectator
18 minutes ago
- Spectator
Will the welfare bill really push 150,000 into poverty?
Labour MPs are obviously going to panic when told their votes might plunge just one person into poverty – let alone 250,000. That was the original estimate for the fallout from Liz Kendall's reforms to Personal Independence Payments (PIP) and Universal Credit. Yesterday, the DWP released a revised figure after Starmer caved to a rebellion by 126 MPs. The new number? Some 150,000 pushed into poverty. A marginally better headline, at a £2.5 billion cost to the taxpayer, but still enough to send the collective shits up Labour's already jittery backbench. Frustratingly, these numbers, put out by the government, are completely meaningless. The government's chosen metric, 'relative poverty', tells us far more about income inequality than it does about the number of people unable to meet their basic needs. Defined as a household income below 60 per cent of the median, it effectively labels more people poor whenever others get richer. So any reform short of a full-blown redistribution of wealth is doomed to fail this test. As the Times's Tom Calver recently pointed out, this measure would have us believe child poverty is now three times worse than it was in the 1960s, when three million lived in actual slums. Yes, the DWP's modelling does also estimate 100,000 more people in 'absolute poverty', but even that includes relative income measures. Neither stat even tries to assess access to food, shelter or energy, which is what poverty actually means to most people. But the real sin of the government's impact assessment? The report explicitly admits: 'This estimate does not include any potential positive impact.' Seriously. What's the point then? Why produce a model of one side (the negative) of a reform but not look at what the reform is actually aimed at doing? Without looking at the possibility that the impact of the reforms might actually be to encourage and help benefits claimants towards work and hence further away from poverty then you've produced a document that serves no helpful purpose other than to assist a rebel whipping operation. Now, the original assessment of the reforms did include estimates of how many people would come off benefitsm but again states: This estimate does not include the impact of the £1 billion annual funding, by 2029/2030, for measures to support those with disabilities and long-term health conditions into employment, which we expect to mitigate the poverty impact among people it supports into work. So the government has carried out this reform without any real estimate of how many people it will get back into work, the supposed goal of the reform. It's clearly proved very difficult for Labour's front bench to win the argument without it. Government is completely infested with this one-sided approach to modelling. We saw it in lockdown when Sage didn't consider the behaviour response of the population in response to the virus. We saw it with the non dom exodus where the civil servants in His Majesty's Treaurary didn't bother to consider that a large amount of wealthy taxpayers may look to flee the country in response to being squeezed, as is now happening. We see it in the government's approach to cigarettes, with one government model working on the base assumption that all policies achieve the desired result. I'm sure there'll be some law, regulation or convention that demands the publication of these impact assessments, but it must be within the wit of our civil service to fill them with numbers which are at least balanced if not useful. Instead, we've ended up with MPs understandably freaked out into forcing concessions that create perverse incentives for claimants to stay on benefits which they might no longer need. Why be honest about your improving health or attend a reassessment if you risk having to face a harsher set of criteria if you fall ill again. Forgetting incentives, what possible moral justification can there be for saying: 'These rules won't apply to those of you on PIP already, but if you're diagnosed next year then tough luck! You're on your own.' Incentives matter. There is no relationship between the rate of ill health in this country and the explosion in sickness benefits we're seeing. Wise heads – such as those at the Institute for Fiscal Studies – have looked hard yet found no link with NHS waiting lists either. So the increase in sickness claimants must be explained, at least in part by the incentive structures within the system. Maybe this is all a technocratic sideshow. Maybe MPs aren't really reading these assessments. But it's hard to shake the feeling we're trapped in a system built to make reform impossible, and governed by MPs too squeamish to try.
STV News
19 minutes ago
- STV News
Future of Keir Starmer's welfare reforms to be decided by MPs
The future of Keir Starmer's welfare reforms are set to be decided on Tuesday when MPs will vote on the Prime Minister's Universal Credit and Personal Independence Payment Bill. Despite a significant U-turn last week, a Labour rebellion against the measures is still a possibility. Starmer was forced to yield to political pressure from within his own party after 126 Labour backbenchers signed their names to an amendment to halt the welfare reform legislation in its tracks last week. Among the rebels were nine Scottish Labour MPs. The Prime Minister's welfare reforms originally proposed to cut Universal Credit health top-ups for new claims from April 2026, and scrap the Work Capability Assessment (WCA). The reforms also vowed to review Personal Independence Payment (PIP) assessments and 'focus PIP on those with higher needs', while consulting on plans to delay access to the health top-up in Universal Credit until claimants turn 22. The cuts to Universal Credit would have directly impacted benefit claimants in Scotland, while the other changes would have impacted the amount of money coming to Social Security Scotland for devolved benefits, like Adult Disability Payments, which replaced PIP for Scots. The Scottish Government would have been responsible for making decisions about welfare and disability benefits based on its budget. However, Labour rebels argued the plans were rushed and would push vulnerable disabled people into poverty. After originally doubling down on the reforms, Starmer's government was forced to back-track ahead of Tuesday's crucial vote. Under the concessions, work and pensions secretary Liz Kendall said PIP claimants will continue to receive the benefits they currently get, as will recipients of the health element of Universal Credit. She said the planned benefit cuts will only hit future claimants. Campaigners have accused the latest proposals of creating a two-tier benefits system, and official government analysis released on Monday showed the reforms will still push 150,000 people into relative poverty across the UK, rather than the 250,000 first suggested. The U-turn will also leave UK chancellor Rachel Reeves scrambling to find £3bn due to the last minute U-turn. The concessions are believed to have won over the majority of the 120-odd MPs who had signed a wrecking amendment, but dozens of Labour MPs will still refuse to back the reforms on principle. The reforms will be put to a vote on Tuesday around noon. The House of Commons proceedings will be broadcast from the chamber. Get all the latest news from around the country Follow STV News Scan the QR code on your mobile device for all the latest news from around the country
Telegraph
30 minutes ago
- Telegraph
Starmer braces for major welfare rebellion
Sir Keir Starmer is bracing for the biggest Labour rebellion of his premiership at a crunch vote on his flagship welfare Bill this evening. MPs are due to vote for the first time on the Universal Credit and Personal Independence Payment Bill at 7pm. Sir Keir hoped he had defused the revolt last week after he caved in to rebel demands to water down some of his welfare cuts. But the Prime Minister is still facing a rebellion by dozens of Labour MPs who are due to vote against the Bill because they believe the Government's concessions do not go far enough amid concerns it will push tens of thousands of people into poverty. Some 39 Labour MPs have signed a new amendment designed to torpedo the legislation. That would be far short of the 83 needed to overturn the Government's majority and to kill the Bill but a rebellion of 39 would still represent a hammer blow to Sir Keir's authority. Join the conversation in the comments section below.
