Louise Haigh declines to rule out higher taxes to pay for rising welfare bill

Will Meakin-Durrant and Abbie Llewelyn, Press Association Political Staff

Senior Cabinet minister Louise Haigh has declined to rule out tax rises to pay for higher welfare spending.

Ms Haigh, who is effectively Andy Burnham’s deputy as First Secretary of State, was asked whether she could “promise” that her party “will not put up taxes to cover these ever-increasing costs”.

Standing in for Mr Burnham at this week’s Prime Minister’s Questions, Ms Haigh told the Commons: “We have been repeatedly clear that we cannot afford to pay for failure and must invest in success – and that is how we will bring the welfare bill down.

“We will make support more conditional on taking up opportunities, ensuring young people get help they need earlier, tackling the long-term drivers of welfare spending, including high housing costs, and we will do all this in a Labour way.”

The minister was responding to the question from the Conservative Party’s deputy leader Alex Burghart, who said: “Welfare spending is going to go up every single year of this Parliament.”

He accused the Government of delaying the publication of a review, led by former health secretary Alan Milburn, into young people and work “until after the Budget”, which Chancellor John Healey unveiled last week.

“The Government isn’t going to fix welfare and we know why,” Mr Burghart continued.

“We know why because the Welfare Secretary (Pat McFadden) told us – the Welfare Secretary said that every meeting he had with Labour MPs was about ‘who can we tax in order to pay benefits’.

“And it’s very likely that (Ms Haigh) was one of those MPs.

“We all remember that she was the person who led the rebellion against Keir Starmer’s very modest welfare reforms.”

Sir Keir’s administration proposed tightening the personal independence payment (Pip) benefit eligibility requirements during his first year in office.

But ministers shelved their plan after dozens of Labour backbenchers threatened to rebel against it in the voting lobbies.

They promised not to make changes to the Pip rules until after a review led by social security minister Sir Stephen Timms, due to be published later this month.

After Ms Haigh’s answer, Mr Burghart said: “We all know what the Labour way is.

“The Labour way is more tax, more welfare and more borrowing.

“There’s no commitment to reduce welfare and there’s no promise not to put up tax.

“They know what needs to be done but they don’t have the bottle to do it.

“They’re too scared to cut spending and they’re too weak to do the right thing – they’re too busy putting off ’til tomorrow what needs to be done today, and everyone else is paying the price.”

The Conservative frontbencher said: “If Labour doesn’t want to do the right thing, why doesn’t it just get out of the way?”

Defending the Government’s position, Ms Haigh said: “I know (Mr Burghart) regards himself as the Tory’s resident historian.

“In fact, he once published a paper titled Profile of a Doomed Elite – I’m sure the House will be as surprised as I was to learn it wasn’t a study of the prospects of the current shadow cabinet.

“So, as a student of history, he’ll be well aware that few governments have delivered the scale and speed of change that this administration has in our first 100 days.”

To cheers from the Labour benches, Ms Haigh continued: “Cutting business rates for 70,000 businesses, cutting tax for entrepreneurs, cutting VAT from electricity bills, helping 20 million households with energy bills, scrapping standing charges, capping bus fares, investing in our high streets, extending parental pay, tackling rough sleeping.”

Ms Haigh said Mr Burghart did not “seem impressed”, adding “the only Government that has had more of an impact in a shorter space of time was the one he served under” led by Liz Truss, at a time when the overall rate of inflation was approaching its peak at 11.1%.

Welfare spending is forecast to rise by £19 billion over this year to £353 billion.

The Office for Budget Responsibility forecasts it will rise to £431 billion by the 2031-32 financial year, largely driven by health-related and pensioner benefits.

During their exchange, Mr Burghart also asked about Mr Burnham’s promise to draw up a 10-year plan for the country, which the Prime Minister made during his first speech after taking the keys to No 10 earlier this year.

“I’m old enough to remember Keir Starmer’s 10-year plan because it was six months ago,” 49-year-old Mr Burghart said, to laughter.

“This is the only political party in history to have two 10-year plans in 10 months.

“But given that the Labour Party is experimenting with planning, can it commit to reduce this record welfare bill, the highest welfare bill ever, as part of its 10-year plan?”

The First Secretary, 39, replied: “We are taking steps already to bring the welfare bill down – and we’ll take further.

“We’ve committed to legislate but every week, the opposition party comes and brings the same problems with the same messes that we inherited on welfare, on defence, on immigration, on the economy.

“This Labour Government are committed to tackling it all.”

Mr Burnham missed Wednesday’s Prime Minister’s Questions because he is at the Commonwealth Heads of Government Meeting in Antigua and Barbuda.