Welfare system will be here 'for years to come' amid backlash over impending cuts

17 March 2025, 10:01 | Updated: 17 March 2025, 15:26

The welfare state will be there for those who need it "now and for years to come", the work and pensions secretary has said - as the government faces pressure from its own MPs over benefit changes.

Liz Kendall acknowledged there has been "lots of speculation" about the government's plans to reform welfare, which are due to be announced on Tuesday following a delay because of concerns from Labour backbenchers.

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Speaking in the House of Commons, Ms Kendall said she wanted to assure the public the announcements will "ensure there is trust and fairness in the social security system" - and that it will remain in place for those who need it.

Earlier on Monday, Sky News revealed the government has chosen not to freeze the personal independence payment (PIP) next year following pressure from Labour MPs over the past week.

Ministers had wanted to stop PIP (a payment of up to £9,000 a year for people with long-term physical and mental health conditions, and disabilities) rising with inflation as part of a drive to cut the welfare budget.

The proposal had been set to save about £5bn, as Chancellor Rachel Reeves searches for savings.

She has lost £9.9bn of fiscal headroom (the amount she could increase spending or cut taxes without breaking her fiscal rules) since the October budget due to a poor economy and geopolitical events.

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The government is expected to make qualifying for PIP more difficult when Ms Kendall reveals her plans on Tuesday.

Sky News' deputy political editor Sam Coates, on the Politics At Sam And Anne's podcast, said the Treasury is also expected to abolish the Work Capability Assessment, which determines whether someone is fit or not to work and to then receive disability payments.

The government has described the system as "dysfunctional", as those "not fit for work" do not receive employment support or further engagement after the assessment, which could lock them out of future work altogether.

Sir Keir Starmer has made cutting the welfare budget a key project, as spending on sickness benefits soared to £65bn last year - a 25% increase since the year before the pandemic - and is expected to rise to £100bn before the next general election in 2029.

The number of people in England and Wales claiming either sickness or disability benefit has gone from 2.8 million to about four million since 2019.

Ms Kendall also revealed in the Commons the number of young people not working because of mental health conditions has risen by more than 25% in the last year, with the number considered "economically inactive" now reaching 270,000.

Unhappy Labour MPs

Ms Kendall had been expected to announce welfare cut plans last week.

But due to the scale of the concerns, the government took the unusual step of asking all 404 Labour MPs to attend "welfare roundtables" in Downing Street last week.

Greater Manchester's Labour mayor, Andy Burnham - an ex-health secretary - agreed the welfare system "needs a radical overhaul", wrote in The Times that the potential changes would "trap too many people in poverty".

Treasury minister Emma Reynolds played down the level of discontent over plans to freeze PIP, telling Sky News the roundtables were nothing more than "everyday business".

She added there will "always be a safety net for the most vulnerable" and pointed out Labour created the welfare state in 1945, but said it needs to be "more sustainable".

(c) Sky News 2025: Welfare system will be here 'for years to come' amid backlash over impending cuts