Labour’s welfare proposals are causing deep divisions within the party
Keir Starmer’s government was elected on the promise of transforming people’s lives, but some of its MPs believe more austerity is no change at all
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As a Westminster journalist, people are often surprised when I tell them how much of my time goes into waiting outside the doors of places where politicians are meeting. Monday evening, like many days before it, was spent doing just that. I watched as Labour MP after Labour MP left the hour-long meeting of the Labour parliamentary party, each echoing a similar message when I approached them: Prime Minister Keir Starmer had been “brilliant” and they were all “singing from the same hymn sheet”.
I turned to a colleague and said: “The headline here is that Labour MPs think the Labour prime minister is fantastic.” She smirked.
Behind those closed doors, however, a very different conversation was unfolding. Last weekend, ITV News revealed the extent of welfare reforms being considered by the Labour government. The proposals include making it harder to qualify for personal independence payments, which are supposed to help with additional cost of disabilities, and cutting the rate of universal credit for those judged unfit for work while raising it for those actively seeking or in employment.
At the meeting, Starmer defended the government’s approach, insisting that it and the country at large couldn’t “just shrug our shoulders” at how much is currently being spent in the welfare system. He also assured MPs that any changes would align with “Labour values”. Some in the room were not convinced and a couple of hostile questions were aimed in his direction.
One MP, speaking privately to me, described the proposed cuts as “draconian”, warning that the party was attempting to balance the economy “on the backs of disabled people”. Another told me they had argued with ministers that the government should not be “penalising those who are struggling” but, instead, needs to address the root causes of ill health.
A decade ago Labour was one of the fiercest critics of the Conservative government’s austerity measures under David Cameron, condemning cuts to welfare that disproportionately affected the country’s most vulnerable people. Now that Labour is in power, there is growing discomfort among some of its MPs over the prospect of implementing similar measures.
As many as 80 Labour MPs could be willing to rebel over the proposed cuts. That figure is concerning to the government. Assuming all other parties are united in voting against the proposals, it would take around that many Labour MPs doing the same to block the legislation in the Commons. However, early conversations I have had with Conservative MPs suggest that the government may not have to worry too much. Many on the Tory benches support the premise of the reforms, though they are waiting for full legislative details before making a final decision.
Predicting the size of parliamentary rebellions is a fool’s game. In my experience numbers are often exaggerated or underestimated on purpose, but No 10 is not taking any chances and a rebellion of that size is not a good look.
In an effort to quell the growing unease within the party, Labour MPs have been invited to roundtable discussions to debate the “future of the welfare system”. One minister told me those sessions will allow MPs to raise concerns while reinforcing the government’s position that the current system “traps people in a lifetime of welfare” and that urgent savings are needed. The exact details of the policy have not been officially released and some MPs are hoping the roundtables can be used to influence the direction the government is going in and get it to change course.
So why is the government pursuing this now? There are a few explanations. First, all government departments have been ordered to make urgent savings, particularly with increased pressure to boost defence spending. Then there are Labour’s self-imposed fiscal rules, which limit the amount of borrowing the government can do. Beyond financial constraints, there are clearly ideological reasons, too.
Last year, the UK spent £65bn on sickness benefits — a 25% increase from the year before the pandemic. Surging welfare spending has become a source of concern in government circles. In his address to MPs, Starmer described the current welfare system as “the worst of all worlds” and said the figure was so high it was “unfair”.
Work and pensions secretary Liz Kendall had previously told ITV News that too many people were “taking the mickey” by claiming benefits when they should be working. I’ve also seen a letter signed by 36 Labour MPs arguing that reforming the welfare state is a “moral duty” and that the current system is “holding people back”.
The division within the Labour government is emblematic of a broader political challenge. The party swept to power on a promise of change, but its leadership is now grappling with the reality of running the country within tight financial constraints. For those who hoped a Labour government would mark an end to austerity, the proposed welfare cuts feel like a bitter pill to swallow.
Ultimately, the success or failure of these reforms will depend on how the government navigates internal dissent. Starmer’s majority is large but not unassailable and Labour MPs know that they will be held to account by their constituents, many of whom will argue they did not vote for this. Many MPs I’ve spoken to are arguing that they did not enter Westminster as Labour politicians to enact such policies, or to divert the foreign aid budget, or make cuts to winter fuel payments.
For now, the government is attempting to strike a balance: reassuring its MPs that reforms will be consistent with Labour values while signalling to the public that it is serious about fiscal responsibility. But, as the rebellion grows, the question remains: how many Labour MPs are willing to test the limits of party unity and will the government listen to their concerns?
Shehab Khan is an award-winning presenter and political correspondent for ITV News.
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