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Washington Post
a day ago
- Business
- Washington Post
UK leader Starmer waters down planned welfare cuts after revolt in his Labour Party
LONDON — British Prime Minister Keir Starmer gave way to political pressure on Friday, watering down planned welfare reforms to avoid defeat by his own party's lawmakers. It's the latest forced U-turn for a center-left government caught between conflicting goals of cutting spending and improving public services. The government planned to bring a bill to Parliament next week that would tighten eligibility for a key disability benefit, removing the Personal Independence Payment from hundreds of thousands of people with long-term physical or mental health conditions. Another health-related benefit received by people on low incomes would also be reduced under the plans. The government said the proposed changes would help people find jobs while preserving a safety net for those who can never work. It would also save an estimated 5 billion pounds ($7 billion) a year from a welfare bill that has ballooned since the COVID-19 pandemic. But many Labour lawmakers balked at the changes, which the Institute for Fiscal Studies think tank estimated would cut the income of 3.2 million people by 2030. More than 120 of the 403 Labour legislators signed a motion that would effectively kill the bill if it were to be passed. Defeat at the hands of his own party in the vote planned for Tuesday would have seriously damaged Starmer's authority. To avoid that, the government said it would ensure no one who currently receives the PIP benefit will lose it. Starmer was elected a year ago in a landslide victory, winning a commanding majority of seats in the House of Commons. Since then his popularity has plunged as a sluggish economy and stubbornly high inflation resist efforts to raise living standards and ease a cost-of-living squeeze. Even as Starmer enjoyed success on the world stage – charming U.S. President Donald Trump and securing a trade deal to exempt Britain from some U.S. tariffs – Labour lawmakers have grown restive at the party's sagging poll ratings and the rise of the hard-right Reform U.K. party led by Nigel Farage . Starmer has been forced into several U-turns. In May the government dropped a plan to end winter home heating subsidies for millions of retirees. Last week Starmer announced a national inquiry into organized child sexual abuse, something he was pressured to do by opposition politicians — and Elon Musk . The government insists that major changes to welfare are needed to deal with a 'broken' system inherited from the previous Conservative government. It says the spending cuts it is making will be balanced by new money and support to help people who are able to work find jobs. The government wants to reduce the number of working-age people who are economically inactive through long-term sickness, which it says stand at 2.8 million, the highest rate of any G7 nation. At a NATO summit on Wednesday, Starmer dismissed griping about the welfare plans as 'noises off.' But the next day, he insisted he was listening to party rebels. 'All colleagues want to get this right, and so do I,' Starmer said. 'We want to see reform implemented with Labour values of fairness,' he told lawmakers. 'That conversation will continue in the coming days, so we can begin making change together on Tuesday.'
Telegraph
a day ago
- Business
- Telegraph
The wealthy county with the highest council tax in Britain
Rutland is often described as the one of the healthiest, happiest and best places to live in Britain. But it comes at a high cost. 'We live in a very special place, and I suppose we have to pay for that,' says one stoic Rutland resident. Her council tax bills are among the highest in the country, and are due to increase further. Bills could rise by nearly £600 under Labour. It has left residents asking: 'Why are we being singled out?' Rutland County Council charges the highest tax in the country, with the average Band D household paying £2,671 a year. The national average is nearly £400 lower. Analysis by The Telegraph found that if Rutland continues to raise council tax by the maximum amount each year, households' average bills would increase by £576 by 2030 to £3,247. And this looks likely. Councils that have social care responsibilities, such as county and unitary authorities, can increase tax by a maximum of 4.99pc – and Chancellor Rachel Reeves's spending review gave them the green light to keep doing so. Nine in 10 town halls, including Rutland, opted to raise the tax in April. The Institute for Fiscal Studies has warned that the UK should brace for council tax to rise at its fastest rate in 20 years. It means half of authorities will see increases of at least £500 by 2030. Oakham is filled with stone-coloured houses reminiscent of the Cotswolds, and is popular with tourists who arrive en masse on buses. The small county, with just 41,000 residents and its own flag and castle, also has one of the best-run councils in the country. Pride in the county runs deep, and residents are happy to call themselves 'Rutlanders'. But underneath, there is a growing resentment towards the exorbitant council tax bills. Patrick Brammer has lived in the county for 29 years with his wife Valerie, and doesn't see how the 'high tax can be justified'. The 68-year-old says: 'You get your bins collected, street lights, and that's about it. We get the same services as everyone else. It's not clear how the tax is spent.' 'I've got no problem with the council themselves,' he adds. 'I don't see why we're singled out particularly for such high council tax. Just over the border in Leicestershire, you'll probably pay a few hundred pounds less.' If you have a second home in the council, your tax bill will be much higher. Rutland County Council was one of the 204 authorities which introduced the second home premium in April. There are currently 223 second homes in the area, paying an average of £5,230. Tax rises 'driving away potential buyers' If tax rises continue at this rate, a Band H second home in the county will be paying £12,986 by 2030. Meanwhile, an average second home, a Band D property, could be left on the hook for £6,494. Henry Burgess, of James Sellicks estate agency in Oakham, says such high council tax will drive away potential buyers, which would be a 'crying shame'. He adds: 'If council tax does continue to rise, second home owners will decide they've got better things to spend their money on. It will remove any pull to get a second home in this area, which will have a knock-on effect on high streets. Instead, families could spend a little less on council tax and have a home on the coast. 'If it does keep increasing, even ordinary buyers, who are generally bound by schools or work, may opt to buy somewhere else.' Bobbi Cook, a 19-year-old single mother, has lived in Rutland her whole life. Pushing her pram with eight-month-old, Rowan, she points out how uneven the roads and pavements are. She is paying £111 a month to the council, which includes the 25pc single person allowance. But she doesn't think the council spends it well. 'As a single parent, it's a lot. If, after the bills go up, you could see the roads getting better and more police on the streets, then it would make sense because it would be going to something good,' she says. 'But at the minute, that's not what's happening. And once you have a baby, everything gets more expensive. All the bills are going up. But my wage hasn't.' Another Oakham resident, Moss, who declined to give his full name, is resigned to the imminent bill increases. 'I don't like it, but I don't have a choice,' he says. The 41-year-old says he is completely 'squeezed' by his bills, which leave him with next to no spending money each month. Last year, the Liberal Democrat-run council revealed it was in a £46.6m deficit. A spokesman said that Rutland 'gets a particularly raw deal when it comes to government funding'. It relies on council tax for 79pc of funding, compared with the national average of 56pc. He added: 'After making hundreds of thousands of pounds of savings in the last financial year, we were incredibly disappointed that we had to propose a further increase in council tax. 'This is not something that any councillor wants to do. It is because of the hand we're dealt, in terms of our national funding allocation.' 'Council tax has gone up a lot, and every year' This shortfall may be widened thanks to Labour's plans to restructure local government. The council fought, and won, for its independence as a unitary authority in 1997. But Angela Rayner's reorganisation plans mean that Rutland may be forced to merge with Leicestershire County Council. This proposal has not proved popular among residents, however, as Leicestershire's spending is set to outstrip income by more than £100m by 2027. Alicia Kearns, Conservative MP for Rutland and Stamford, has opposed reorganisation. She previously told The Telegraph there was a misconception that the county was full of 'wealthy retirees'. 'We've got one of the lowest social mobility scores in the country,' she said, adding that she does not believe merging will improve this. Diana and Chris Corp concede that Rutland is a fairly wealthy area – but council tax has gone up 'a lot, and every year'. Originally from Leicester, the former teachers have lived locally for the past 12 years, and now pay the council £310 a month. 'We don't have massive crime waves and schools closing down, however, it's not really obvious where the tax is spent,' says Diana, 76. 'There is no police presence where we live, and even though it's a small market town, there is an undercurrent of petty crime which gets neglected. 'We have to pay extra to get the garden waste taken away and that goes up every year. And the roads are appalling.' Other residents have a more generous outlook on their high bills. Terry Kilmartin, a 72-year-old local, says her council tax is 'too much', but that 'we're better off than other places'. Nitesh Bhundia, 44, owns a wine shop called L'Art de Vivre with his friend, Thomas Troisvallets. In an age where high streets across the country are struggling, the pair are confident in their business model, as there is the 'demand for high end shopping' in Oakham. Bhundia has lived in the town for six years with his wife and two daughters. 'I grew up in Leicester where there was a high crime rate and it was so unsafe. Here, the parks are well-kept and the bins aren't overspilling. We live in a bit of a bubble in Rutland,' he explains. 'There is no other place like this in England.'
Associated Press
a day ago
- Business
- Associated Press
UK leader Starmer waters down planned welfare cuts after revolt in his Labour Party
LONDON (AP) — British Prime Minister Keir Starmer gave way to political pressure on Friday, watering down planned welfare reforms to avoid defeat by his own party's lawmakers. It's the latest forced U-turn for a center-left government caught between conflicting goals of cutting spending and improving public services. The government planned to bring a bill to Parliament next week that would tighten eligibility for a key disability benefit, removing the Personal Independence Payment from hundreds of thousands of people with long-term physical or mental health conditions. Another health-related benefit received by people on low incomes would also be reduced under the plans. The government said the proposed changes would help people find jobs while preserving a safety net for those who can never work. It would also save an estimated 5 billion pounds ($7 billion) a year from a welfare bill that has ballooned since the COVID-19 pandemic. But many Labour lawmakers balked at the changes, which the Institute for Fiscal Studies think tank estimated would cut the income of 3.2 million people by 2030. More than 120 of the 403 Labour legislators signed a motion that would effectively kill the bill if it were to be passed. Defeat at the hands of his own party in the vote planned for Tuesday would have seriously damaged Starmer's authority. To avoid that, the government said it would ensure no one who currently receives the PIP benefit will lose it. Starmer was elected a year ago in a landslide victory, winning a commanding majority of seats in the House of Commons. Since then his popularity has plunged as a sluggish economy and stubbornly high inflation resist efforts to raise living standards and ease a cost-of-living squeeze. Even as Starmer enjoyed success on the world stage – charming U.S. President Donald Trump and securing a trade deal to exempt Britain from some U.S. tariffs – Labour lawmakers have grown restive at the party's sagging poll ratings and the rise of the hard-right Reform U.K. party led by Nigel Farage. Starmer has been forced into several U-turns. In May the government dropped a plan to end winter home heating subsidies for millions of retirees. Last week Starmer announced a national inquiry into organized child sexual abuse, something he was pressured to do by opposition politicians — and Elon Musk. The government insists that major changes to welfare are needed to deal with a 'broken' system inherited from the previous Conservative government. It says the spending cuts it is making will be balanced by new money and support to help people who are able to work find jobs. The government wants to reduce the number of working-age people who are economically inactive through long-term sickness, which it says stand at 2.8 million, the highest rate of any G7 nation. At a NATO summit on Wednesday, Starmer dismissed griping about the welfare plans as 'noises off.' But the next day, he insisted he was listening to party rebels. 'All colleagues want to get this right, and so do I,' Starmer said. 'We want to see reform implemented with Labour values of fairness,' he told lawmakers. 'That conversation will continue in the coming days, so we can begin making change together on Tuesday.'
Sky News
2 days ago
- Politics
- Sky News
Government makes concessions to Labour rebels over welfare reforms
The government has made an offer to rebel Labour MPs over its controversial welfare reforms, Sky News understands. More than 120 Labour MPs were poised to vote against the Universal Credit and Personal Independence Payment (PIP) Bill on Tuesday. The changes come after a ring-around by cabinet ministers failed to bring rebels on side. The bill was intended to restrict eligibility for the PIP - the main disability payment in England- and limit the sickness-related element of universal credit, to help shave £5bn off the welfare budget by 2030. Sky News political editor Beth Rigby has been told that existing PIP claimants will be able to keep their payments, which means 370,000 people will not lose out. This will cost the government at least £1.5bn, according to the Institute for Fiscal Studies. Sky News understands that a senior source has accepted the change, but it will be up to each individual rebel to make a decision on whether to withdraw. The source said they think the changes are a "good package" with "generous concessions". A reasoned amendment signed by 126 Labour MPs argued that disabled people had not been properly consulted and further scrutiny of the changes is needed. If passed, this would have killed the bill. Other concessions offered by the government include allowing existing claimants to keep the health element of Universal Credit. Sky News understands that some senior rebels are willing to accept the concessions - with one saying that "the concessions will be positively received, and I expect to vote with the government now". Other MPs who had not wanted to rebel were also expecting to change their votes. However, several Labour MPs on the left of the party have gone public to say they will still oppose the government, including Diane Abbott, Richard Burgon, Nadia Whittome and Brian Leishman. Conservative shadow chancellor Sir Mel Stride said the change would mark a "screeching U-turn" - and claimed the changes mark "another unfunded spending commitment". What is PIP? The biggest shakeup to the system involved changes to PIP - money given to people, including some of whom are in work - who have extra care needs or mobility needs as a result of a disability. People who claim it are awarded points depending on their ability to do certain activities, such as washing and preparing food, and this influences how much they will receive. From November 2026, people would have needed to score a minimum of four points in at least one activity to qualify for the daily living element of PIP - instead of fewer points spread across a range of tasks. This would have impacted existing claimants as well as new ones. The government's concessions are understood to see this change dropped for existing claimants. The government intended to freeze the health element of universal credit, claimed by more than two million people, at £97 a week during this parliament, and cut the rate to £50 for new claimants. Again, it's understood the government's concessions mean this change now won't apply to existing claimants.
Sky News
2 days ago
- Politics
- Sky News
Government to make concessions to Labour rebels over welfare reforms, Sky News understands
The government has made an offer to rebel Labour MPs over its controversial welfare reforms, Sky News understands. More than 120 Labour MPs were poised to vote against the Universal Credit and Personal Independence Payment (PIP) Bill on Tuesday. The changes come after a ring-around by cabinet ministers failed to bring rebels on side. The bill was intended to restrict eligibility for the PIP - the main disability payment in England- and limit the sickness-related element of universal credit, to help shave £5bn off the welfare budget by 2030. Sky News political editor Beth Rigby has heard that existing PIP claimants will be able to keep their payments, which means 370,000 people will not lose out. This will cost the government at least £1.5bn, according to the Institute for Fiscal Studies. Sky News understands that a senior source has accepted the change, but it will be up to each individual rebel to make a decision on whether to withdraw. The source said they think the changes are a "good package" with "generous concessions". A reasoned amendment signed by 126 Labour MPs argued that disabled people had not been properly consulted and further scrutiny of the changes is needed. If passed, this would have killed the bill. Other concessions offered by the government include allowing existing claimants to keep the health element of Universal Credit.
