‘The rhetoric’s turned people’s stomachs’: MPs challenge Kendall over welfare cuts

A string of Labour MPs and union leaders have challenged the Work and Pensions Secretary in the Commons over the government’s welfare reform plans, with Labour divisions laid wide open as the government unveiled the “biggest reforms to employment support in a generation”.

Most of the cabinet were out in force for the statement by Liz Kendall, including Ed Miliband, Wes Streeting, Bridget Phillipson, Angela Rayner and Rachel Reeves. One cabinet member said the cabinet was “united” over reducing the welfare bill, despite some reports to the contrary.

The government has said it will save £5bn from the controversial changes to the welfare system, including tightening eligibility for personal independence payments and consulting on removing the health topup part of universal credit for under-22s. The health element will also be frozen until 2029.

In her address, Liz Kendall also announced the government would consult on the creation of a new “time-limited unemployment insurance”, merging JSA and ESA benefits, and plans to scrap the work capability assessment.

She also said the government would legislate for a “right to try”, allowing people on sickness benefits to try work without having their benefits cut as a result, and grant a permanent above-inflation rise to the standard allowance in Universal Credit “for the first time ever”.

Cheers as Kendall rules out freezing PIP benefits

But Kendall ruled out means-testing or freezing PIP, to cheers from the back benches, in what looked like a significant climbdown on previously briefed proposals that had sparked speculation it would trigger the government’s biggest parliamentary rebellion yet. A rebellion remains possible however if other changes come to a vote.

Kendall told the Commons several times she was “not interested in being tough” and that we have to be “careful how we talk” about people, in what appeared an effort to ease backbench disquiet.

Several Labour MPs spoke out in the Commons with their concerns despite the government’s partial rowback, and TUC general secretary Paul Nowak and disability charities also joined the backlash on Tuesday.

While some MPs accept the rationale for welfare reform given the rising costs to the Treasury of health-related benefits, many drew a line at cutting benefits for those unable to work – and even some sympathetic to reforms have despaired at the party’s messaging.

MPs demand reassurances constituents won’t be impoverished

Dawn Butler said the welfare system needed reform, but it was “crass” to link reforms to saving money – and had caused “lots of anxiety”. She said a wealth tax was a “better way to fill the black hole”. Kim Johnson echoed the plea for a wealth tax, and not for “attacking the most vulnerable”.

Former shadow minister Sarah Owen said in the Commons Labour MPs understood the financial “binfire” inherited from the Tories, but asked for reassurances that those unable to feed or toilet themselves would not lose out on personal care.

Clive Lewis spoke out shortly after her speech of the “pain and difficulty” the savings would make to his constituents who are “on the brink”. He warned that the impact of the savings would have a greater impact than the Department of Work and Pensions claims ,and said constituents were “very angry” about the move. “They do not think this is the kind of action a Labour government takes.”

Former shadow chancellor John McDonnell claimed such heavy cutbacks risked lives, appearing to reference the deaths of claimants under Tory austerity.

Mary Kelly Foy, another figure on the left of the party, asked for reassurances reforms wouldn’t push people into poverty and ill health. Helen Hayes asked for assurance reforms would not make child poverty worse. Anneliese Midgley asked for assurances those unable to work would not be worse off.

‘Trashing of a fundamental part of Labour’s compassionate brand appeal’

One Labour MP told LabourList that their colleagues were “aghast at the appalling political management of this”.

“There was a perfectly progressive way to drive this reform, but banging it while we’re trying to fix a Budget problem and turning into a macho test of ‘toughness’ has truly turned peoples’ stomachs.

“We’ve turned a perfectly reasonable public policy problem into a trashing of a fundamental part of Labour’s compassionate brand appeal.”

Another told LabourList that there had been “concern all round” and expressed hopes that ministers have listened, but that the party “need to learn from this”.

“We lost the narrative early and the look isn’t a good one,” the MP added.

READ MORE: ‘The public doesn’t think welfare works – but they are more compassionate than sometimes believed’

LabourList has heard that in at least one of Number 10’s meetings with Labour MPs, there were “serious, well informed and deep concerns” from all corners of the Parliamentary Labour Party.

Meanwhile, one critic of Liz Kendall is said to have privately compared her to a “crap council cabinet member who just accepts all the cuts council officers have wanted to make for years, irrespective of whether they meet our ideological position or get us hammered with the public”. One ally called the comments “pathetic, weird and embarrassing for them”, however.

‘Colleagues have to be realistic’

One MP told LabourList: “I think the backlash has been bigger than [ministers] expected. But I also think colleagues have to be realistic in light of fiscal challenges.”

Cabinet Office minister Pat McFadden defended the government on the broadcast round this morning, telling Times Radio today: “The cabinet is united behind taking on the issue of the growing benefits bill, the fact that we currently have almost three million people on long-term sickness benefits and that’s projected to grow to over four million at a steady state.

“That demand for these benefits is outstripping the disability rates by a factor of double and by the fact that if we don’t do anything about it we’ll be spending 70 billion pounds a year on this by the end of the decade. The current system leaves too many people in a permanent state of dependence on benefits without the opportunity of work.

“We used to have on some of these indices a few thousand applications a month, now it’s a thousand a day going on to personal independence payments for example or who are applying for it.”

New MP Dan Tomlinson wrote for LabourList: “The calls for this government to do a re-run of New Labour when it comes to tax and spend keep coming…this government has taken over an economy which has stagnated for over a decade; a tax burden already much higher than under Brown…This government can’t do everything right away.”

Another MP who spoke to LabourList highlighted the difference between the values of the Conservatives and Labour, and stressed that any reform of the welfare system should “give people dignity” and grant support to those who cannot work.

“The Tories presiding over an ever-increasing number of people on out of work benefits was not out of compassion, but because they lacked ambition for people.”

Unions speak out over ‘Thatcherite assault on the welfare state’

Only 32% of LabourList readers in an informal poll of around 450 respondents last week said they agreed with the Prime Minister that the rising working-age benefit bill is “indefensible”. Some 57% said they did not agree.

Meanwhile, trade union leaders have also been critical of the government’s moves on welfare reform.

TUC General Secretary Paul Nowak said: “While we welcome the decision not to freeze PIP, this package will still lead to significant cuts in entitlements for some disabled people.”

Steve Wright of the FBU called cuts a “Thatcherite assault on the welfare state”, warning:  “Cutting benefits will cause a surge in food bank use and lead to poverty levels last seen in the 1980s. ”

He said it was “shameful”, accusing some in cabinet of “gleefully eulogising about the need to cut the derisory payments”.

Usually loyal Unison general secretary Christina McAnea warned: “Hitting those least able to speak up for themselves is never acceptable.”

While she said bad decisions by the Tories had left the new Labour government “in a corner financially”, she added that it was “no excuse for ministers to go after the most vulnerable and contemplate freezing personal independence payments”.

Starmer critic and Unite general secretary Sharon Graham said Labour was “making the wrong choices” over welfare reform in an op-ed for The Mirror. “Some of the decisions that have been made, if you closed your eyes, you would not think it was a Labour government making them.”

Left-wing national executive committee member Jess Barnard added: “We know full well that had this been announced under the Tories, Labour front benchers would be up in arms – rightly so. “Starmer is pushing through austerity 2.0 without the mandate to do it. It wasn’t in the manifesto and it wasn’t on our candidates’ pledge cards.”

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