Rachel Reeves planning £3bn welfare cuts in Budget
Rachel Reeves will seek to make around £3 billion of cuts to welfare over the next four years by restricting access to sickness benefits, it is understood.
The Chancellor is expected to commit to the previous Tory government’s plans to save the sum by reforming work capability rules, as first reported by The Telegraph.
Under Conservative proposals, welfare eligibility would have been tightened so that around 400,000 more people who are signed off long-term would be assessed as needing to prepare for employment by 2028/29, reducing the benefits bill by an estimated £3 billion.
Reform
It is understood that Ms Reeves will commit to the plan to save £3 billion over four years, but Work and Pensions Secretary Liz Kendall will decide how the system will be changed in order to achieve this.
A Government spokesperson said: “We have always said that the Work Capability Assessment is not working and needs to be reformed or replaced alongside a proper plan to support disabled people to work.
“We will deliver savings through our own reforms, including genuine support to help disabled people into work.”
Ms Reeves is looking to raise up to £40 billion from tax hikes and spending cuts in the Budget as the Government seeks to avoid a return to austerity.
Sir Keir Starmer on Thursday faced a Cabinet backlash over the planned measures, with several ministers writing to the Prime Minister directly to express concern about proposals to reduce their departmental spending by as much as 20%.
Downing Street warned that “not every department will be able to do everything they want to” and “tough decisions” would have to be made.
“Major measures”
The Prime Minister’s official spokesman confirmed Sir Keir and Ms Reeves have agreed on the “major measures” of the Budget, including the “spending envelope” that sets out limits for individual Whitehall departments.
While some spending cuts are all but inevitable, tax rises are expected to form the centrepiece of Ms Reeves’ plans to fill what the Labour Government calls a “black hole” in the public finances left behind by its Tory predecessors.
Reports suggest capital gains tax and inheritance tax are among some of the levers the Chancellor will pull to raise revenue as she seeks to put the economy on a firmer footing.
The Budget will be delivered on October 30.
The Chancellor will hold talks with City bosses on Friday at the first meeting of Labour’s British infrastructure taskforce, as the Government seeks advice on how to boost investment in the UK.
Finance chiefs from HSBC, Lloyds and M&G will be among those involved in the discussions, which the Treasury says will take place regularly.
Ms Reeves said their expertise will be “invaluable in the weeks and months ahead” as the Government pursues its “number one mission to grow the economy and create jobs”.
Chief Secretary to the Treasury Darren Jones said the taskforce would aim to end “the cycle of underinvestment that has plagued our infrastructure systems for over a decade.”
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There is no blackhole, this is a poor political decision to appease financial markets.
Cuts are always a political choice. Seems odd to cut benefits to the sick when so many of them cannot work because they cannot get NHS treatment. Is it connected to the fact Reeves husband is Director General of the DWP and was during tory rule? Ill advised in other words.
Conflict of interest…our interest…another marriage of national power and influence beyond democracy
Absolutely, we no longer live in a democracy it seems. Our only voting choice, apart from Plaid, is neo liberal monetarist politicians , corrupt at the core
She looks very pleased with herself, so their mantra is ‘Rule of Law’ or rule by lawyers…
We know what that is like…self-serving protectionist…
Yes protectionism is high on the agenda. Reeves husband is DWP director general so little wonder Labour resisting calls for full investigation into unnecessary deaths caused by misconduct of senior DWP people.
Labour are playing right into the hands of Reform and the Tories. Good job fools! They’ll be a Tory/Fascist Government in five years and this island thought Tories on their own were bad 😂 That’s nothing! Ask an Italian left winger what a Fascist Government did to their country 🙁😞😢
…..and Fascism was created by a socialist who decided he needed something more “robust”. Fascists will come out of the woodwork all round the political spectrum when their craving for power exceeds their capacity for reason.
Help the disabled ? Sounds more like the old Nazi stunt of helping them right up to the gate of the “final solution” camp. Some will work for a while then that one way trip to assisted dying …… Sounds far fetched, but think again.
There are some very worrying trends in that direction and big questions being asked about the policy in operation in Canada where the rules seem particularly laxed.
Its as if the Tories got re-elected! Klaus and his billionaire mates will be pleased!
Where are the reforms to corporate tax evasion, reforms to money laundering in the city of London financial institutions, reforms to offshore banking ? Far easier to go after the poor sick and disabled, who can not afford a top barrister and legal team fight for them. I remember when Labour acted for the poorest in society, but those days are long gone and buried.
“We have always said that the Work Capability Assessment is not working and needs to be reformed…” = not effective of denying sick and disabled people support. The whole approach to sickness and disability is now based on the Biopsychosocial model which has been majorly criticised because it lacks meaningful scientific content. Anyone applying for long term sickness/disability benefits is subject to regular Work Capability Assessments, even where the sickess/disability has been medically adjudged to be permanent. It’s also commonly the case that medical opinion is completely ignored and the results too often suggest that very sick/disabled people are adjudged… Read more »
Come the budget the press will have to report facts instead of making it up.
labour, grrrrr
How about cutting some of the “welfare” doled out to the rich tax dodgers and corporate parasites that hover around the public purse looking for handouts at every turn?
There really doesn’t seem to be much difference between Labour and the Tories these days. This fixation with reducing the welfare system – as if it’ll cure all ills – is set in Westminster ways. Millions will, once again be affected. Millions who are already suffering from a greed driven cost of living crisis. This is a Labour government, for god’s sake, why aren’t they attacking the greed and wealth of this country? It really really is time for change, not the change of this two faced government but through independence. Come on Cymru, it is the only option.