The welfare reform vote: All you need to know

Independent

18 hours ago

MPs have backed a Government proposal to reform welfare payments for sick and disabled people, but only after significant concessions saw much of Sir Keir Starmer's plan abandoned.
Below, the PA news agency looks at what happened, what it means for personal independence payment (Pip) and universal credit, and what might come next.
– What have MPs agreed to?
MPs voted on Tuesday to allow the Government's Universal Credit and Personal Independence Payment Bill to advance to the next stage in becoming law.
Some 126 Labour backbenchers had previously threatened to vote against the legislation, enough to block its passage through the Commons, but in the end only 49 did so.
But ministers were forced to offer a series of concessions to persuade the rebels to back the Government.
– What concessions did the Government make?
Last week, Work and Pensions Secretary Liz Kendall announced a partial U-turn aimed at heading off the rebellion that included three key points.
Firstly, changes to Pip eligibility would only come into effect in November 2026, and anyone claiming the benefit before that date would not be subject to the new rules, instead of imposing the changes on everyone.
Secondly, people claiming the health element of universal credit, and new claimants with the most severe conditions, would see their incomes protected in real terms.
Thirdly, disabilities minister Sir Stephen Timms would conduct a review of the Pip assessment, 'co-produced' with disabled people.
But during Tuesday's debate, Sir Stephen offered a further concession, saying any changes to Pip eligibility would only be introduced after his review had concluded, further delaying them.
– What do the concessions mean for the Government's proposals?
The decision to push back Pip changes to an unspecified date, and leave uncertain the details of what those changes will be, removes a major part of the Government's reform plans.
The proposed changes to universal credit remain, raising the standard allowance while halving the health element for most new claimants from April 2026.
But the concessions will also pose a problem for Chancellor Rachel Reeves, who will need to find extra money now the expected savings from welfare reform are no longer expected to materialise.
Indeed, the Resolution Foundation think tank suggested the concessions meant there would now be no 'net savings' from the reform by 2029/30, a key year for Ms Reeves' fiscal targets.
– What happens next?
The Government has pledged to make the necessary amendments to remove the Pip changes from the Bill when it returns to the Commons next week.
It is then likely to continue through Parliament, becoming law after it has been approved by both MPs and peers.
But wider questions remain for the Government. Not only does Ms Reeves face a fiscal headache, but the Prime Minister could face a political one too as he seeks to repair fractured relations with his backbenchers.
And uncertainty will continue to surround the Government's plans for welfare reform.
Ministers will still want to reduce the cost of the welfare bill and get more people back into work, while Sir Stephen's Pip review could result in another row depending on what it recommends.