Rachel Reeves is reportedly facing a Cabinet backlash over planned welfare cuts. More than half of Sir Keir Starmer’s Cabinet are said to have urged the Chancellor to rethink her plans to slash public spending and overhaul the benefits system in a bid to balance the books ahead of her spring statement.
The ministers spoke out at a Cabinet meeting on Tuesday which overran, Bloomberg reported. Ministers expressed frustration that the welfare cuts are coming so soon after the foreign aid budget was raided and raised fears that they would be difficult to sell to Labour MPs.
One person said that some Cabinet members are on resignation watch depending on the scale of the changes.
Backbenchers have also issued warnings over the cuts to the benefits system, expected to be announced next week.
The Prime Minister yesterday insisted that the existing system could not be justified on “moral” or “economic” terms.
Sir Keir denied Britain would be “returning to austerity” under the changes but said the cost of benefits was “going through the roof” and on track to surpass the bill for the Home Office and prisons combined.
Speaking on a visit to Hull on Thursday, Sir Keir said: “The welfare system as it’s set up, it can’t be defended on economic terms or moral terms.
“Economically, the cost is going through the roof. So if we don’t do anything, the cost of welfare is going to go to £70 billion per year. That’s a third of the cost of the NHS.
“That’s more than the Home Office and our prisons combined. So we’re making choices here.”
He said that “most people say to me” that they want more police officers on the beat and a criminal justice system working effectively.
“We’ve set up a system that basically says, ‘if you try the journey from where you are into work and anything goes wrong, you’ll probably end up in a worse position when you started.’
“And so understandably, many people say, ‘well, I’m a bit scared about making that journey.’ Therefore we’re baking in too many people not being able to get into work.”
Asked during a Q&A with journalists after his speech whether he accepted the changes would amount to return to austerity, he said: “We’re the party of work. We’re also the party of equality and fairness, but we’re not returning to austerity.
“That’s what I said before the election. That’s what I say now.”