Latest news with #UniversalCredit
Scottish Sun
3 hours ago
- Business
- Scottish Sun
Labour rebels who forced Keir Starmer into a U-turn set to demand axe to two-child benefit cap
The reforms are expected to pass next Tuesday 'dog's dinner' Labour rebels who forced Keir Starmer into a U-turn set to demand axe to two-child benefit cap Click to share on X/Twitter (Opens in new window) Click to share on Facebook (Opens in new window) LABOUR rebels who forced Sir Keir Starmer into a U-turn are to demand the two-child benefit cap is axed. The PM faces the fresh test after watering down a £5billion savings package amid backbench unrest. Sign up for the Politics newsletter Sign up 1 126 Labour MPs threatened to scupper the moves Credit: PA People down south currently receiving Personal Independence Payment and Universal Credit will continue to get them, with the cuts only hitting new claimants. The Labour Government made the concession after 126 Labour MPs threatened to scupper the moves. The reforms are expected to pass next Tuesday but experts warned tax rises may be needed to afford them. And it emerged Labour rebels now have the two-child cap in their sights. It follows an earlier climbdown on winter fuel payments. The PIP changes don't affect Scots as it has been replaced here by the Adult Disability Payment. But Nats ministers could be boosted by extra cash freed up by the U-turn — as the SNP pushes ahead with £150million plans to scrap the two-child cap in Scotland. Nats MP Kirsty Blackman accused Labour of creating 'a dog's dinner of a system' down south that punishes the young and newly disabled. She said: 'If these cuts go ahead, they'll embed discrimination, creating an unfair two-tier system. The SNP Scottish Government is clear it won't follow these discriminatory, two-tier disability cuts.' Labour peer Lord Hutton accused Sir Keir of putting 'party before country' by caving in to rebels'. Keir Starmer 'to BACK DOWN' on benefits cuts as he faces major revolt from MPs But Pensions Secretary Liz Kendall downplayed Labour splits, insisting: 'We have listened to people.' No10 claimed there would be no 'permanent' increase in borrowing as a result of the U-turn but declined to rule out tax rises to fund it.
Sky News
4 hours ago
- Business
- Sky News
This has been Starmer's most damaging U-turn yet - but the bigger cost is the political one
Why you can trust Sky News It has been a painful week to watch. A U-turn in slow motion, culminating in a midnight climbdown as Number 10 agreed to concede to defiant MPs on Thursday night. The concessions are considerable. They mean, among other compromises, that existing claimants of personal independence payments (PIP) and the health aspect of Universal Credit will be protected from welfare reforms. Some MPs, like Diane Abbott and Nadia Whittome, remain unconvinced, but they were never high on the list of rebels the government expected to persuade. Ministers now hope that with the backing of MPs like Dame Meg Hillier, the chair of the Treasury Select Committee, the bill will pass the Commons. Their problems won't end there, though. Firstly, there is the question of money. The Resolution Foundation estimates the concessions will cost £3bn of the £5bn the chancellor hoped to save from the welfare reforms. The prime minister 's spokesperson says the changes will be fully funded in the budget and there will be no permanent increase in borrowing. They won't comment on any potential tax rises to plug the gap in Rachel Reeves's finances. The bigger cost, though, is the political one. A year ago, when Sir Keir Starmer strode into Downing Street with a thumping majority, few could have imagined how the last few days would play out. More than 120 MPs, nearly a third of the parliamentary Labour party and more than the total number of Tory MPs, publicly prepared to rebel on a flagship policy. How did it come to this? How did the prime minister, and the people around him, not see a rebellion coming when there had been signs MPs weren't happy for weeks? Those are the questions being asked by senior Labour figures behind the scenes. Sir Keir's spokesperson says the prime minister consistently engages with colleagues, and parliamentary engagement takes many forms. But a lack of engagement with backbenchers has led to the prime minister's most damaging U-turn yet, and this week will haunt the prime minister beyond Tuesday's crunch vote.
Rhyl Journal
4 hours ago
- Business
- Rhyl Journal
Warnings of tax rises after Downing Street welfare U-turn
The Prime Minister said that the concessions strike 'the right balance', but think tanks have warned that the changes announced in the early hours of Friday morning have made Rachel Reeves's 'already difficult Budget balancing act that much harder'. Downing Street declined to rule out the possibility of increases in the autumn, telling reporters on Friday that 'tax decisions are set out at fiscal events'.The concessions on offer include protecting personal independence payments (Pip) for all existing claimants, while all existing recipients of the health element of Universal Credit will have their incomes protected in real terms. The Institute for Fiscal Studies (IFS) said on Friday that the changes make tax rises in the budget expected in the autumn more likely. Associate director Tom Waters said: 'These changes more than halve the saving of the package of reforms as a whole, making the Chancellor's already difficult Budget balancing act that much harder.' Ruth Curtice, chief executive at the Resolution Foundation, said that 'the concessions aren't cheap, costing as much as £3 billion and more than halving the medium-term savings from the overall set of reforms announced just three months ago'. She added: 'This adds to the already mounting pressure to deliver fresh consolidation in the Budget this Autumn.' The Resolution Foundation noted that extending a freeze in personal tax threshold by one year would save '£4 billion a year'. Asked about how the climbdown would be funded, Downing Street said on Friday that 'There'll be no permanent increase in borrowing, as is standard. 'We'll set out how this will be funded at the budget, alongside a full economic and fiscal forecast in the autumn, in the usual way.' Asked whether they could say there would be no tax rises, a Number 10 spokesman said: 'As ever, as is a long-standing principle, tax decisions are set out at fiscal events.' Some 126 Labour backbenchers had signed an amendment that would have halted the Universal Credit and Personal Independence Payment Bill in its tracks when it faces its first Commons hurdle on July 1. The list of Labour MPs putting their name to the amendment had been growing throughout the week, as Downing Street said that they would be pressing on with next week's vote. After the late-night U-turn, Sir Keir said that 'the most important thing is that we can make the reform we need'. 'We talked to colleagues, who've made powerful representations, as a result of which we've got a package which I think will work, we can get it right,' he added. 'For me, getting that package adjusted in that way is the right thing to do, it means it's the right balance, it's common sense that we can now get on with it.' While leading rebels believe the concessions are likely to be enough to win over a majority, some remain opposed to the plans in their current form. Dr Simon Opher, who represents Stroud, said in a statement that he is glad the Government 'are listening', but that the changes 'do not tackle the eligibility issues that are at the heart of many of the problems with Pip'. 'The Bill should be scrapped and we should start again and put the needs of disabled people at the centre of the process,' he said. It is also understood that talks are underway over rebel attempts to lay another amendment to seek to delay the plans, as reported by The Guardian. The fallout also threatens to cause lasting damage, with some backbenchers having called for a reset of relations between Number 10 and the parliamentary party. Speaking to the PA news agency, a number of Labour backbenchers expressed deeper frustration with how Downing Street has handled its backbenchers since last year's election. The Government's original package had restricted eligibility for Pip, the main disability payment in England, as well as cutting the health-related element of universal credit. Existing recipients were to be given a 13-week phase-out period of financial support in an earlier move that was seen as a bid to head off opposition. Now, the changes to Pip 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 concessions on Pip alone protect some 370,000 people currently receiving the allowance who were set to lose out following reassessment.
Glasgow Times
4 hours ago
- Business
- Glasgow Times
Warnings of tax rises after Downing Street welfare U-turn
The Prime Minister said that the concessions strike 'the right balance', but think tanks have warned that the changes announced in the early hours of Friday morning have made Rachel Reeves's 'already difficult Budget balancing act that much harder'. Rachel Reeves's Budget is set to be much harder to balance following the U-turn (Owen Humphreys/PA) Downing Street declined to rule out the possibility of increases in the autumn, telling reporters on Friday that 'tax decisions are set out at fiscal events'.The concessions on offer include protecting personal independence payments (Pip) for all existing claimants, while all existing recipients of the health element of Universal Credit will have their incomes protected in real terms. The Institute for Fiscal Studies (IFS) said on Friday that the changes make tax rises in the budget expected in the autumn more likely. Associate director Tom Waters said: 'These changes more than halve the saving of the package of reforms as a whole, making the Chancellor's already difficult Budget balancing act that much harder.' Ruth Curtice, chief executive at the Resolution Foundation, said that 'the concessions aren't cheap, costing as much as £3 billion and more than halving the medium-term savings from the overall set of reforms announced just three months ago'. She added: 'This adds to the already mounting pressure to deliver fresh consolidation in the Budget this Autumn.' The Resolution Foundation noted that extending a freeze in personal tax threshold by one year would save '£4 billion a year'. Asked about how the climbdown would be funded, Downing Street said on Friday that 'There'll be no permanent increase in borrowing, as is standard. 'We'll set out how this will be funded at the budget, alongside a full economic and fiscal forecast in the autumn, in the usual way.' Asked whether they could say there would be no tax rises, a Number 10 spokesman said: 'As ever, as is a long-standing principle, tax decisions are set out at fiscal events.' Some 126 Labour backbenchers had signed an amendment that would have halted the Universal Credit and Personal Independence Payment Bill in its tracks when it faces its first Commons hurdle on July 1. The list of Labour MPs putting their name to the amendment had been growing throughout the week, as Downing Street said that they would be pressing on with next week's vote. After the late-night U-turn, Sir Keir said that 'the most important thing is that we can make the reform we need'. 'We talked to colleagues, who've made powerful representations, as a result of which we've got a package which I think will work, we can get it right,' he added. 'For me, getting that package adjusted in that way is the right thing to do, it means it's the right balance, it's common sense that we can now get on with it.' While leading rebels believe the concessions are likely to be enough to win over a majority, some remain opposed to the plans in their current form. Dr Simon Opher, who represents Stroud, said in a statement that he is glad the Government 'are listening', but that the changes 'do not tackle the eligibility issues that are at the heart of many of the problems with Pip'. 'The Bill should be scrapped and we should start again and put the needs of disabled people at the centre of the process,' he said. It is also understood that talks are underway over rebel attempts to lay another amendment to seek to delay the plans, as reported by The Guardian. The fallout also threatens to cause lasting damage, with some backbenchers having called for a reset of relations between Number 10 and the parliamentary party. Speaking to the PA news agency, a number of Labour backbenchers expressed deeper frustration with how Downing Street has handled its backbenchers since last year's election. The Government's original package had restricted eligibility for Pip, the main disability payment in England, as well as cutting the health-related element of universal credit. Existing recipients were to be given a 13-week phase-out period of financial support in an earlier move that was seen as a bid to head off opposition. Now, the changes to Pip 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 concessions on Pip alone protect some 370,000 people currently receiving the allowance who were set to lose out following reassessment.
South Wales Argus
4 hours ago
- Business
- South Wales Argus
Warnings of tax rises after Downing Street welfare U-turn
The Prime Minister said that the concessions strike 'the right balance', but think tanks have warned that the changes announced in the early hours of Friday morning have made Rachel Reeves's 'already difficult Budget balancing act that much harder'. Rachel Reeves's Budget is set to be much harder to balance following the U-turn (Owen Humphreys/PA) Downing Street declined to rule out the possibility of increases in the autumn, telling reporters on Friday that 'tax decisions are set out at fiscal events'.The concessions on offer include protecting personal independence payments (Pip) for all existing claimants, while all existing recipients of the health element of Universal Credit will have their incomes protected in real terms. The Institute for Fiscal Studies (IFS) said on Friday that the changes make tax rises in the budget expected in the autumn more likely. Associate director Tom Waters said: 'These changes more than halve the saving of the package of reforms as a whole, making the Chancellor's already difficult Budget balancing act that much harder.' Ruth Curtice, chief executive at the Resolution Foundation, said that 'the concessions aren't cheap, costing as much as £3 billion and more than halving the medium-term savings from the overall set of reforms announced just three months ago'. She added: 'This adds to the already mounting pressure to deliver fresh consolidation in the Budget this Autumn.' The Resolution Foundation noted that extending a freeze in personal tax threshold by one year would save '£4 billion a year'. Asked about how the climbdown would be funded, Downing Street said on Friday that 'There'll be no permanent increase in borrowing, as is standard. 'We'll set out how this will be funded at the budget, alongside a full economic and fiscal forecast in the autumn, in the usual way.' Asked whether they could say there would be no tax rises, a Number 10 spokesman said: 'As ever, as is a long-standing principle, tax decisions are set out at fiscal events.' Some 126 Labour backbenchers had signed an amendment that would have halted the Universal Credit and Personal Independence Payment Bill in its tracks when it faces its first Commons hurdle on July 1. The list of Labour MPs putting their name to the amendment had been growing throughout the week, as Downing Street said that they would be pressing on with next week's vote. After the late-night U-turn, Sir Keir said that 'the most important thing is that we can make the reform we need'. 'We talked to colleagues, who've made powerful representations, as a result of which we've got a package which I think will work, we can get it right,' he added. 'For me, getting that package adjusted in that way is the right thing to do, it means it's the right balance, it's common sense that we can now get on with it.' While leading rebels believe the concessions are likely to be enough to win over a majority, some remain opposed to the plans in their current form. Dr Simon Opher, who represents Stroud, said in a statement that he is glad the Government 'are listening', but that the changes 'do not tackle the eligibility issues that are at the heart of many of the problems with Pip'. 'The Bill should be scrapped and we should start again and put the needs of disabled people at the centre of the process,' he said. It is also understood that talks are underway over rebel attempts to lay another amendment to seek to delay the plans, as reported by The Guardian. The fallout also threatens to cause lasting damage, with some backbenchers having called for a reset of relations between Number 10 and the parliamentary party. Speaking to the PA news agency, a number of Labour backbenchers expressed deeper frustration with how Downing Street has handled its backbenchers since last year's election. The Government's original package had restricted eligibility for Pip, the main disability payment in England, as well as cutting the health-related element of universal credit. Existing recipients were to be given a 13-week phase-out period of financial support in an earlier move that was seen as a bid to head off opposition. Now, the changes to Pip 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 concessions on Pip alone protect some 370,000 people currently receiving the allowance who were set to lose out following reassessment.
