Liz Kendall promises changes to welfare system
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Liz Kendall says welfare reforms aim to 'fix broken system'
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Labour is set to unveil cuts to benefits today amid mounting fury from backbenchers. Prime Minister Sir Keir Starmer will meet his Cabinet this morning to sign off the package aimed at getting people back to work and bringing down the rising welfare bill.
Work and Pensions Secretary Liz Kendall will outline plans in the House of Commons this afternoon. Downing Street has insisted there is a "moral and an economic case" for an overhaul and that the changes would put the welfare system "back on a more sustainable path". But there has been growing disquiet from Labour backbenchers ahead of the anticipated changes.
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Work and Pensions Secretary Liz Kendall (Image: Getty)
What are the reforms?
The "work capability assessment" for universal credit, which is used to determine eligibility for incapacity benefit payments for those with illnesses or disability who have limited ability to find a job, is set to be abolished.
There will also be a cut to the top rate of universal credit incapacity benefit, which will reportedly be partially offset by an increase to the basic rate and ￡1 billion pumped into support schemes to help claimants get into work.
The most controversial element of the package could be changes to the personal independence payment (PIP) with eligibility criteria to be tightened.
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The benefit helps the disabled with the increased cost of living associated with their conditions.
Has there been a U-turn?
The huge backlash from Labour MPs has reportedly prompted a rethink of rumoured plans to freeze the level of PIP rather than increase it in line with inflation, delivering a real-terms cut to 3.6 million claimants.
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Ministers insist that reform is necessary, given the number of people in England and Wales claiming either sickness or disability benefit has soared from 2.8 million to about 4.0 million since 2019.
The welfare bill has risen with this increase, reaching ￡48 billion in 2023-24, and is forecast to continue rising to ￡67 billion in 2029-30.
The Government hopes to save up to ￡6 billion as Chancellor Rachel Reeves struggles to balance the books in the face of weak economic growth and mounting debt interest costs.