Our £5bn disability benefits cut will stop welfare state collapsing, says Kendall

The Guardian

20-05-2025

The work and pensions secretary, Liz Kendall, will double down on Labour's £5bn disability benefits cuts on Wednesday, claiming she is reforming the welfare state to save it from collapse.
Opposition to the welfare package continues to mount within her party before next month's vote. Labour backbenchers claim more than 100 colleagues have signed a private letter telling party whips they are unable to support it.
In a speech to the Institute for Public Policy Research thinktank, Kendall will argue for the need to restrict eligibility for some benefits, insisting that without urgent intervention the cost of the system will run out of control.
'Unless we ensure public money is focused on those with the greatest need and is spent in ways that have the best chance of improving people's lives, the welfare state simply won't be there for people who really need it in the future,' she will say.
'That is why we are grasping the nettle of welfare reform. Not for the sake of it, but to save it.'
The cost of the welfare state has been broadly stable in recent years at about 10% of GDP, but spending on disability benefits has risen sharply.
The cuts were announced in the run-up to Rachel Reeves's spring statement, as the Treasury cast about for savings to ensure its independent forecaster, the Office for Budget Responsibility, could show the chancellor was still on course to hit her self-imposed fiscal rules.
Ruth Curtice, the chief executive of the Resolution Foundation thinktank, acknowledged that with an ageing population and some parts of the welfare safety net fraying, change was necessary.
However, she stressed: 'Reform should consider the whole population – from low-income working families to wealthy pensioners – and be driven by the goal of improving livelihoods, rather than a rush to hit fiscal rules.'
Scepticism about the plans among Labour MPs has intensified since the party's disastrous performance in the local elections, which many blamed on the unpopularity of welfare cuts and the means-testing of the winter fuel allowance.
Some of those threatening to rebel over the changes are committed Keir Starmer loyalists. The 100 backbenchers said to have signed the letter are described by MPs as broadly distinct from the 42 who signed a public statement this month calling the package 'impossible to support'.
The government's own impact assessment showed that the cuts to the personal independence payment (Pip) and the health element of universal credit would result in 3.2m households losing an average of £1,720 a year in benefits.
Analysis by the Disability Poverty Campaign Group, circulated among Labour MPs, pointed to more than 200 of them whose majority is smaller than the number of Pip claimants in their constituency.
Kendall is keen to focus more attention on the £1.8bn in additional spending on back-to-work measures, which forms the other part of the package she fought for in negotiations with the Treasury.
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She will argue that Labour's aim is 'to give people real hope. To give people a better future. To create the jobs and opportunities, and decent public services, people need to build a better life.'
However, labour market experts have warned that any increase in employment as a result of the additional support is likely to be dwarfed by the impact of the cuts.
Stephen Evans, the chief executive of the Learning and Work Institute thinktank, said: 'The employment support will get a significant number of people into work and it will save the taxpayer money, so it's a good thing to do, and it's substantial: it's almost doubling the amount that is being spent now. It will genuinely make a difference. But it cannot plausibly offset the 3.2 million people having cuts to their benefits.'
The thinktank estimates that between 45,000 and 95,000 people are likely to find work as a result of the extra spending – but warns that this is hard to predict, given the government has not yet laid out how it will allocate the money.
Meanwhile, Resolution Foundation analysis of data published by Kendall's department shows the groups hit hardest by the Pip cuts in particular are likely to be the over-50s and those with musculoskeletal conditions, including back pain and arthritis.
These are the groups that are more likely to score less than four points in the eligibility test for the daily living component of Pip – the new threshold set under the changes. Almost 80% of claimants with back pain, 77% with arthritis and 68% with chronic pain syndromes failed to score four points in any category, for example.