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The Herald Scotland
2 days ago
- Business
- The Herald Scotland
Starmer makes U-turn in bid to head off Labour welfare revolt
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.'
The National
2 days ago
- Business
- The National
Labour U-turn on benefits cuts in bid to win over rebel MPs
In a letter sent from Work and Pensions Secretary Liz Kendall to MPs late on Thursday night, it was announced that people who currently receive the Personal Independence Payment (PIP) disability benefit would be exempt from planned cuts to eligibility. Meanwhile, all current recipients of the Universal Credit health element – and any new applicants meeting the "severe conditions criteria" – will have their incomes protected in real terms. READ MORE: 'Bizarre': Question Time called out as Reform councillor joins Scottish panel The announcement marks a watering down of Labour's original package, which restricted eligibility for PIP and limited the sickness-related element of Universal Credit. The concession means that some 370,000 existing claimants who were expected to lose out following reassessment will now be protected, as the Institute for Fiscal Studies (IFS) calculated it will cost around £1.5 billion by the end of the Parliament. However, new claimants from November 2026 will still be subject to these changes in eligibility requirements. The late-night announcement comes after ministers held crisis talks with backbenchers, as more than 100 Labour MPs signed an amendment to halt the legislation in its track, supported by the SNP, Greens and several Independents. The amendment, tabled by Treasury select committee chairwoman Dame Meg Hillier, notes that the UK Government's 'own impact assessment estimates that 250,000 people will be pushed into poverty as a result of [the bill], including 50,000 children". READ MORE: See the full list of 129 Labour MP rebels on UK welfare and Pip cuts Keir Starmer's Universal Credit and Personal Independence Payment Bill will have its second reading on Tuesday, and is the first opportunity for MPs to support or reject it. If it clears the first hurdle, it will then face a few hours' examination by all MPs the following week – rather than days or weeks in front of a committee tasked with looking at the bill. A spokesperson for No 10 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. 'Our reforms are underpinned by Labour values and our determination to deliver the change the country voted for last year.' Meanwhile, Kendall wrote to MPs: 'We will ensure that all of those currently receiving PIP will stay within the current system. The new eligibility requirements will be implemented from November 2026 for new claims only. 'Secondly, we will adjust the pathway of Universal Credit payment rates to make sure all existing recipients of the UC health element – and any new claimant meeting the severe conditions criteria – have their incomes fully protected in real terms.' She said a ministerial review would ensure the benefit is 'fair and fit for the future' and will be a 'coproduction' with disabled people, organisations which represent them and MPs. 'These important reforms are rooted in Labour values, and we want to get them right,' she added. READ MORE: No changes to council tax 'in this decade', says Scottish Government While the concessions have been welcomed by some of the rebels - including Hillier - many remain opposed, and look set to vote against the bill on Tuesday. Scottish Labour MP Brian Leishman said the concessions were "not enough because disabled people will still become poorer". Brian Leishman (Image: PA) "The Government should withdraw the bill & work with organisations & charities to create a welfare system that looks after people," he wrote on Twitter/X. "That's the real Labour thing to do." The new proposals have also been condemned by parties north of the Border, as both the SNP and the Scottish Greens accused Labour of creating a "two-tier" disability system. Stephen Flynn SNP Westminster leader Stephen Flynn said: 'Keir Starmer is on the brink of creating a two-tier disability system where the young will be treated worse than the old. 'The message from the Labour Party is clear – if you have an accident that causes a disability, develop a disability over time or if you have a child with a disability you will receive less support than those who have come before you." READ MORE: Can Keir Starmer find any policy that Anas Sarwar won't support? Flynn added: 'I was a perfectly fit and healthy kid when I collapsed at school before spending eighteen years on crutches, to think that a child in the same position now would be treated differently than I was, simply to save the Prime Minister's reputation, is disgusting. 'If these rebels truly care about the cause in the way that they suggest, then they will tell the Prime Minister to think again, again.' Maggie Chapman (Image: Christian Gamauf) Meanwhile, Scottish Greens MSP Maggie Chapman said the U-turn will still "hurt disabled people". She said: 'This decision is good news but only for some people. It is testament to the hard work and determination of disabled people and other activists who have been fighting to stop these brutal cuts. 'Starmer might have done a partial U-turn but, instead of creating a fair welfare system for all he's created a two-tier benefits system. New claimants will still be subjected to the new, harsher assessment regime, and will not receive the benefits they need and deserve." Chapman added that it was "astonishing" that a Labour Government "would ever even contemplate such cruel and inhuman cuts". She continued: 'We must keep up the pressure to ensure that new claimants get what they need, because these reforms will still hurt thousands of disabled people around the country for generations to come. 'These rebels might have saved Starmer's skin this time, but Greens will keep fighting against these dangerous austerity measures from Labour and make the case for Scotland to build a fair social security system that treats everyone with dignity and respect.'
Powys County Times
2 days ago
- Business
- Powys County Times
Government announces concessions to welfare bill after talks
People who currently receive the personal independence payment (Pip) will continue to do so after the Government made concessions to Labour rebels on controversial welfare reforms. A letter from Work and Pensions Secretary Liz Kendall to MPs said adjustments to universal credit would also see incomes protected. The announcement comes after crisis talks with backbenchers, with some 126 MPs within the party signing an amendment that would halt the legislation in its tracks. Sir Keir Starmer's Universal Credit and Personal Independence Payment Bill has its second reading on Tuesday, the first opportunity for MPs to support or reject it. A spokesperson for Number 10 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. 'Our reforms are underpinned by Labour values and our determination to deliver the change the country voted for last year.' The Government's original package restricted eligibility for the personal independence payment (Pip), the main disability payment in England, and limited the sickness-related element of universal credit. Existing claimants 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 by aiming to soften the impact of the changes. In her letter, the Work and Pensions Secretary said: 'We recognise the proposed changes have been a source of uncertainty and anxiety. 'We will ensure that all of those currently receiving PIP will stay within the current system. The new eligibility requirements will be implemented from November 2026 for new claims only. 'Secondly, we will adjust the pathway of Universal Credit payment rates to make sure all existing recipients of the UC health element – and any new claimant meeting the severe conditions criteria – have their incomes fully protected in real terms.' She said a ministerial review would ensure the benefit is 'fair and fit for the future' and will be a 'coproduction' with disabled people, organisations which represent them and MPs. 'These important reforms are rooted in Labour values, and we want to get them right,' she said. The change in Pip payments would protect some 370,000 existing claimants who were expected to lose out following reassessment. If the legislation clears its first hurdle on Tuesday, it will then face a few hours' examination by all MPs the following week – rather than days or weeks in front of a committee tasked with looking at the Bill. The so-called 'reasoned amendment' tabled by Treasury select committee chairwoman Dame Meg Hillier had argued that disabled people have not been properly consulted and further scrutiny of the changes is needed. She said: 'This is a good deal. It is massive changes to ensure the most vulnerable people are protected… and, crucially, involving disabled people themselves in the design of future benefit changes.' While the concessions look set to reassure some of those who had been leading the rebellion, other MPs remained opposed before the announcement. Speaking to the PA news agency before the concessions were revealed, Rachel Maskell said: 'As the Government is seeking to reform the system, they should protect all disabled people until they have completed their co-produced consultation and co-produced implementation. 'I cannot vote for something that will have such a significant impact … as disabled people are not involved, it is just a backroom deal.' One MP said that ministers would need to 'go back to the drawing board' to make the Bill acceptable. Another said they expected the legislation would get through second reading if the Government conceded the key sticking points relating to existing Pip claimants, the health element of universal credit and a policy consultation. 'It would need to be in the Bill, not just a commitment,' they said. Speaking in the Commons on Wednesday, Sir Keir told MPs he wanted the reforms to reflect 'Labour values of fairness' and that discussions about the changes would continue over the coming days. He insisted there was 'consensus across the House on the urgent need for reform' of the 'broken' welfare system. 'I know colleagues across the House are eager to start fixing that, and so am I, and that all colleagues want to get this right, and so do I,' he said. 'We want to see reform implemented with Labour values of fairness. 'That conversation will continue in the coming days, so we can begin making change together on Tuesday.' 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'. '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,' director of strategy Jackie O'Sullivan said. But 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'. Head of campaigns at the charity, Charlotte Gill, 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.'
ITV News
3 days ago
- Business
- ITV News
Peston: Whatever the outcome is on welfare reform, Starmer and Reeves lose
Angela Rayner told MPs today that next week's vote on the Universal Credit and Personal Independence Payment bill will go ahead as planned. She has been in frontline politics long enough to know that this was a passable imitation of a turkey voting for Christmas. Because despite her party's humungous majority in the Commons, she and her leader Keir Starmer don't have the votes. What's gone wrong, and what can Starmer do? One problem for them is that - less than a year into the life of this parliament - too many of his MPs are tired of being treated like cattle, and are depressed by that they see as Starmer's lack of optimistic purpose. As several said to me, they feel exploited and taken for granted. Here is how one grumpy MP laid the blame at the PM's door: "He's never here. He never votes. And his team patronise and infantalise us." So when Labour's party managers threaten uncooperative MPs with being expelled if they vote the wrong way, some say bring it on, that returning to civvy street would be a blessed release. Then there is the almost primal fact about Labour politicians: their instincts are that benefits are to be increased, not cut, and most especially not for the vulnerable. So legislating to take £5 billion from disabled people before being able to demonstrate how these vulnerable people would be helped into fulfilling employment was always going to be inflammatory. Months ago, I put to the Work and Pensions Secretary Liz Kendall on my show that she was making a mistake by putting the welfare-cuts cart before the job-creation horse. In reply, she obfuscated. The truth is that it was a rushed job, driven by a Chancellor Rachel Reeves who believed she needed the savings to persuade the Office for Budget Responsibility that she wouldn't breach her own fiscal rules. It is the same misjudgement Reeves made when abolishing universal entitlement to the winter fuel payment: she decided that manifesting her financial prudence to big investors, the buyers of government debt, gilts, was the imperative. But while it is true that the government's borrowing costs are painfully high, and it would be difficult for her if they were to rise further, it is not obvious that investors would have dumped the pound and sterling assets if she had taken more time over the welfare reforms. What she could have done was to announce an intention to reform disability benefits in this autumn's budget, when presumably she would have been better placed to show the mechanisms for helping disabled people find and keep paid employment, and when she would also (probably) be able to sweeten the pill by abolishing the two-child limit on universal credit payments. So given that on the current trajectory, Starmer, Reeves and Kendall are heading for humiliating defeat in just a few days, why not at this late juncture just pull the legislation and roll its material reforms into the autumn budget? Here is the painful paradox. That staged approach might well have been credible in the spring. Now such a delay might well say to the nation's creditors that Starmer, Reeves and co are weak and directionless - and that could lead to a painful rise in the interest rate paid by the Treasury. So presumably what we'll see in coming days is the government amending its legislation to soften the cuts, at the political price of being accused of yet another u-turn and at considerable reputational cost to Starmer, Reeves and Kendall. And lenders to the government would also be jittery, if not despairing. There is no painless escape from this for Starmer and Reeves. And there is no ambiguity that this is a mess they made for themselves. For the past 11 months may have been blaming the last Conservative governmnent for all their previous woes, but this debacle is theirs alone.
Powys County Times
4 days ago
- Politics
- Powys County Times
Three committees complain of ‘inadequate consultation' over welfare reforms
Concerns about 'inadequate consultation' on the UK Government's controversial welfare reforms have been raised by parliamentary committees in Scotland, Wales and Northern Ireland. A letter to Work and Pensions Secretary Liz Kendall also said there had been a 'lack of robust data' to allow parliamentarians in the three areas to 'effectively scrutinise' the potential impact of the changes. The letter, sent by the Scottish Parliament's Social Justice and Social Security Committee together with the Equality and Social Justice Committee of the Welsh Senedd and the Northern Ireland Assembly's Committee for Communities, comes as Prime Minister Sir Keir Starmer is facing a rebellion from Labour MPs against the proposed changes. We, alongside @nia_communities & @seneddequality, have jointly written to @leicesterliz, Secretary of State for Work and Pensions, to share our concerns about a lack of meaningful engagement on proposed changes to the UK benefits system. Read the letter: — Social Justice and Social Security Committee (@SP_SJSS) June 25, 2025 A Commons vote on the plans to squeeze sickness and incapacity benefits is due to go ahead on Tuesday, despite 120 Labour MPs having publicly backed a move to block the legislation. Meanwhile, the Work and Pensions Secretary was told there are 'significant concerns' about the Government's changes. The letter from the three committees told how the 'economic backdrop' for many of those claiming disability benefits is 'already extremely challenging'. And the committees added that the payments people receive 'are not symptomatic of a 'broken' system, but make a significant contribution to their health and wellbeing'. They told Ms Kendall they were 'agreed that inadequate consultation and engagement by the UK Government with stakeholders and the devolved institutions has contributed to this sense of concern'. Representatives from the committees added: 'In addition, the lack of robust data and jurisdiction-specific impact assessments presents significant challenges for our three committees to effectively scrutinise potential impacts.' Here they insisted they have been 'constrained by the lack of quality information'. They added: 'Our committees fully support the stated ambition that 'no-one should be consigned to a life on benefits just because they have a health condition or a disability, especially when they're able to and want to work with the right support in place'. 'However, in order to contribute meaningfully to the reform process, committees and citizens must be fully informed and offered every opportunity for meaningful engagement.' A UK Government spokesperson said: 'We are determined to create a welfare system – backed by dedicated employment support we are investing in now – that will help people into work and out of poverty in all parts of the country. 'We will never compromise on protecting people who need our support, and our reforms will mean the social security system will always be there for those who will never be able to work.
