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The Independent
2 days ago
- Business
- The Independent
Welfare reform marks moment of compassion, says Kendall amid backbench anger
The introduction of proposed legislation to reform the welfare system 'marks the moment we take the road of compassion, opportunity and dignity', the Work and Pensions Secretary has said. Liz Kendall's words come amid a backlash from some Labour MPs who have criticised the 'awful' cuts to welfare – which the Government hopes can save up to £5 billion a year. The reforms – aimed at encouraging more people off sickness benefits and into work – are set to include the tightening of criteria for personal independence payment (Pip), which is the main disability benefit, as well as a cut to the sickness-related element of universal credit (UC) and delayed access to only those aged 22 and over. Ministers are likely to face a Commons stand-off with backbench Labour MPs over their plans, with dozens of them last month saying the proposals were 'impossible to support'. In what could be seen as an attempt to head off some opposition, the legislation – known as the Universal Credit and Personal Independence Payment Bill – will give existing claimants a 13-week period of financial support. The Department for Work and Pensions said this will apply to those affected by changes to the Pip daily living component, including those who lose their eligibility to Carers Allowance and the carer's element of UC. But campaigners, including disability equality charity Scope, said the longer transition period, up from an originally expected four weeks, 'will only temporarily delay a cut and disabled people will continue to be living with extra costs when it comes to an end'. Food bank network Trussell said: 'The last-minute details on protections offer something for a small proportion of people, but even they will still see a real-terms cut. 'The reality of this Bill is still record cuts in support for disabled people, and the biggest cuts to social security since 2015.' Contrary to Ms Kendall's words, learning disability charity Mencap accused the Government of having 'confirmed the choice to turn its back on thousands of disabled people and by pushing ahead with these welfare reforms, they are causing a huge amount of anxiety'. Ms Kendall said: 'Our social security system is at a crossroads. Unless we reform it, more people will be denied opportunities, and it may not be there for those who need it. 'This legislation represents a new social contract and marks the moment we take the road of compassion, opportunity and dignity. 'This will give people peace of mind, while also fixing our broken social security system so it supports those who can work to do so while protecting those who cannot – putting welfare spending on a more sustainable path to unlock growth as part of our Plan for Change.' As the Bill was formally introduced to the Commons on Wednesday, and the question asked as to what the next date for debate will be, Labour backbencher and former shadow chancellor John McDonnell could be heard to say 'Never'. A date has not yet been confirmed. Louise Murphy, senior economist at the Resolution Foundation think tank said the longer period of protection for those affected by Pip cuts is 'a sensible tweak that should ease the blow for those who are no longer eligible for support'. But she criticised extra funding for employment support not coming fully into effect until 2029 at the earliest, saying: 'While ministers have softened the stick of welfare cuts, they have not strengthened the carrot of greater employment support.' Sir Keir Starmer said he was 'determined' to ensure the reforms go through because he feels the welfare system 'doesn't work for anyone'. 'It doesn't work for those that want to get back to work, and it certainly doesn't work for the taxpayer,' the Prime Minister told Good Morning Britain, saying 'those that need to be protected should be protected'. 'If you need help in support to get into work, the Government should be providing that support and help to get into work,' he said. 'If you do have conditions, disabilities that mean it is impossible for you to work, then you need to be properly protected and supported.' The latest data, published on Tuesday, showed that more than 3.7 million people in England and Wales are claiming Pip, with teenagers and young adults making up a growing proportion. The figures, published by the Department for Work and Pensions, showed there were a record 3.74 million people in England and Wales claiming Pip as of April this year. The figure is up from 3.69 million in January and a jump of 200,000 from 3.54 million a year earlier. Data for Pip claimants begins in January 2019, when the number stood at 2.05 million. Pip is a benefit aimed at helping with extra living costs if someone has a long-term physical or mental health condition or disability and difficulty doing certain everyday tasks or getting around because of their condition. An impact assessment published alongside Wednesday's Bill introduction, confirmed previously published estimates that changes to Pip entitlement rules could see about 800,000 people lose out, with an average loss of £4,500 per year. Ms Kendall previously said there are 1,000 new Pip awards every day – 'the equivalent of adding a city the size of Leicester every single year'. The impact assessment also confirmed a previous estimate that some250,000 more people, including 50,000 children, are likely to fall into relative poverty after housing costs in 2029/2030, although the Government repeated that this does not take into account the potentially positive impact of £1 billion annual funding by then for measures to support people into work. Changes to UC are expected to see an estimated 2.25 million current recipients of the health element impacted, with an average loss of £500 per year. But the Government said around 3.9 million households not on the UC health element are expected to have an average annual gain of £265 from the increase in the standard UC allowance. While all of the Bill applies to England and Wales, only the UC changes apply to Scotland. The Government said there are equivalent provisions to legislate for Northern Ireland included in the Bill.
Yahoo
12-06-2025
- Business
- Yahoo
‘Perverse' benefits system is unsustainable, warns Liz Kendall
Liz Kendall has said 'perverse incentives' in the benefits system must be tackled as she resists pressure from Labour rebels to water down her welfare reforms. The Work and Pensions Secretary said the Government needed to take 'urgent action' to get people into work and warned that the rise in claims for personal independence payment (Pip) was 'not sustainable'. In a letter to Debbie Abrahams, the chairman of the Commons work and pensions select committee, Ms Kendall said: 'Reforms are needed now to make the system sustainable, while supporting those people with the greatest needs. 'Our plan to rebalance the rates in Universal Credit will remove perverse incentives that trap people in benefit dependency.' The comments come as Ms Kendall's plans to cut personal independence payment (Pip) and the health element of universal credit face mounting criticism from Labour MPs. Last month the MPs' committee urged Ms Kendall to delay the implementation of her reforms, citing concerns about 'the impact of the proposed cuts in universal credit health support on employment, poverty and health outcomes'. Backbenchers have also been calling for the proposals to be dropped. Dismissing their concerns, Ms Kendall wrote: 'We urgently need welfare reform to give people a better future – to stop people from falling into inactivity, restore trust and fairness in the system.' As it stands, those who are permanently signed off work because of sickness and claim universal credit health top up receive more than twice as much as those on the basic level of universal credit. Those signed off sick do not need to look for work, while those on basic universal credit do. Ms Kendall and others argue that this encourages people to claim sickness benefits and puts them off trying to find work. A report from the Resolution Foundation found that 'changes to the benefits system over the last decade have strengthened the incentive to claim incapacity and disability benefits'. The changes to the welfare system include stricter eligibility for claiming Pip and reducing payments for new claimants of the health element of Universal Credit. They are forecast to save £5bn by 2030. The Work and Pensions Secretary said the reforms were necessary as the current rise in Pip cases was outpacing the increase in disability prevalence. Even after changes to disability benefits, the number of people on Pip is still forecast to grow by 750,000 by the end of the parliament, according to government estimates. The cost of Pip is poised to rise from £15bn before the pandemic to £37bn in real terms by the end of the decade, while the overall cost of sickness and disability benefits is expected to climb to £100bn. Pip is the main non-means-tested benefit for those with health conditions or disabilities, with payments of up to £9,500 a year to help people with living costs and getting around. 'With Pip caseload and costs forecast to continue rising, reforms are needed now to make the system sustainable, while supporting those people with the greatest needs,' said Ms Kendall. Under plans announced in March, the Government will tighten the eligibility criteria for people to claim Pip. A separate but linked concern are worries about the high level of unemployed young people. The latest figures from the Office for National Statistics show that 923,000 people aged between 18 and 24 were not in employment, education or training (Neet) in between January and March 2025. There are concerns that many will find themselves stuck on benefits without help. Alison McGovern, the employment minister, told the work and pensions committee on Wednesday: 'The situation for young people – well, it's a big worry for me at the moment.' Ms McGovern added that the high number of Neets meant there were 'nearly one million young people effectively on the scrapheap. They need a start, they need a chance for a career'. Broaden your horizons with award-winning British journalism. Try The Telegraph free for 1 month with unlimited access to our award-winning website, exclusive app, money-saving offers and more.
Telegraph
12-06-2025
- Business
- Telegraph
‘Perverse' benefits system is unsustainable, warns Liz Kendall
Liz Kendall has said 'perverse incentives' in the benefits system must be tackled as she resists pressure from Labour rebels to water down her welfare reforms. The Work and Pensions Secretary said the Government needed to take 'urgent action' to get people into work and warned that the rise in claims for personal independence payment (Pip) was 'not sustainable'. In a letter to Debbie Abrahams, the chairman of the Commons work and pensions select committee, Ms Kendall said: 'Reforms are needed now to make the system sustainable, while supporting those people with the greatest needs. 'Our plan to rebalance the rates in Universal Credit will remove perverse incentives that trap people in benefit dependency.' The comments come as Ms Kendall's plans to cut personal independence payment (Pip) and the health element of universal credit face mounting criticism from Labour MPs. Last month the MPs' committee urged Ms Kendall to delay the implementation of her reforms, citing concerns about 'the impact of the proposed cuts in universal credit health support on employment, poverty and health outcomes'. Backbenchers have also been calling for the proposals to be dropped. Dismissing their concerns, Ms Kendall wrote: 'We urgently need welfare reform to give people a better future – to stop people from falling into inactivity, restore trust and fairness in the system.' As it stands, those who are permanently signed off work because of sickness and claim universal credit health top up receive more than twice as much as those on the basic level of universal credit. Those signed off sick do not need to look for work, while those on basic universal credit do. Ms Kendall and others argue that this encourages people to claim sickness benefits and puts them off trying to find work. A report from the Resolution Foundation found that 'changes to the benefits system over the last decade have strengthened the incentive to claim incapacity and disability benefits'. The changes to the welfare system include stricter eligibility for claiming Pip and reducing payments for new claimants of the health element of Universal Credit. They are forecast to save £5bn by 2030. The Work and Pensions Secretary said the reforms were necessary as the current rise in Pip cases was outpacing the increase in disability prevalence. Even after changes to disability benefits, the number of people on Pip is still forecast to grow by 750,000 by the end of the parliament, according to government estimates. The cost of Pip is poised to rise from £15bn before the pandemic to £37bn in real terms by the end of the decade, while the overall cost of sickness and disability benefits is expected to climb to £100bn. Pip is the main non-means-tested benefit for those with health conditions or disabilities, with payments of up to £9,500 a year to help people with living costs and getting around. 'With Pip caseload and costs forecast to continue rising, reforms are needed now to make the system sustainable, while supporting those people with the greatest needs,' said Ms Kendall. Under plans announced in March, the Government will tighten the eligibility criteria for people to claim Pip. A separate but linked concern are worries about the high level of unemployed young people. The latest figures from the Office for National Statistics show that 923,000 people aged between 18 and 24 were not in employment, education or training (Neet) in between January and March 2025. There are concerns that many will find themselves stuck on benefits without help. Alison McGovern, the employment minister, told the work and pensions committee on Wednesday: 'The situation for young people – well, it's a big worry for me at the moment.' Ms McGovern added that the high number of Neets meant there were 'nearly one million young people effectively on the scrapheap. They need a start, they need a chance for a career'.
Sky News
21-05-2025
- Politics
- Sky News
Politics latest: Keir Starmer announces U-turn on winter fuel payments
Minister defends welfare reforms, saying the system is currently 'not sustainable or fair' Liz Kendall has defended welfare reforms, and said that "no responsible Labour government" could leave the system unchanged. The work and pensions secretary has been addressing people at the Royal Institution in London this morning. She said: "No responsible Labour government can resile from taking decisions because they are too difficult, because this is not good enough for the people we came into politics to serve. "So, we will reform the welfare state." Kendall highlighted how welfare was created when life expectancy was 65, whereas now it is around 80. "One in seven babies born today is likely to live to 100", she said. "Back then, disability was the exception, now one in four of us self-reports as disabled." She went on: "The number of people on the health top up of universal credit is set to rise by 50% to 3 million by the end of the decade, and the number of people on personal independence payment (PIP) is set to more than double to 4.3 million. "There are now 1,000 new PIP awards every single day. That's the equivalent of adding a city the size of Leicester every single year," she added. Populist politics won't deliver the change people want Kendall said the current system "is not sustainable and fair" for taxpayers, and said reform is needed so it "lasts for generations to come". She added that she is "listening carefully to all the points people raise" and that she is aware of "the concerns raised about the proposals". Watch: Beth Rigby explains welfare reforms made earlier this year Kendall also pointed out that 90% of those claiming PIP when the changes come into effect in November next year will "not be affected by the end of the parliament". Defending the reforms, Kendall also hit out at "populist politics". She said: "People in this country rightly demand change, but populist politics, the politics of division and easy but empty solutions won't deliver the change people are crying out for. "They need real hope, built on real solutions. And that is what this Labour government is doing." She concluded that change "of this scale isn't easy, but it is possible".
Sky News
21-05-2025
- Politics
- Sky News
Politics latest: Keir Starmer announces changes will be made to winter fuel payments cut
Minister defends welfare reforms, saying the system is currently 'not sustainable or fair' Liz Kendall has defended welfare reforms, and said that "no responsible Labour government" could leave the system unchanged. The work and pensions secretary has been addressing people at the Royal Institution in London this morning. She said: "No responsible Labour government can resile from taking decisions because they are too difficult, because this is not good enough for the people we came into politics to serve. "So, we will reform the welfare state." Kendall highlighted how welfare was created when life expectancy was 65, whereas now it is around 80. "One in seven babies born today is likely to live to 100", she said. "Back then, disability was the exception, now one in four of us self-reports as disabled." She went on: "The number of people on the health top up of universal credit is set to rise by 50% to 3 million by the end of the decade, and the number of people on personal independence payment (PIP) is set to more than double to 4.3 million. "There are now 1,000 new PIP awards every single day. That's the equivalent of adding a city the size of Leicester every single year," she added. Populist politics won't deliver the change people want Kendall said the current system "is not sustainable and fair" for taxpayers, and said reform is needed so it "lasts for generations to come". She added that she is "listening carefully to all the points people raise" and that she is aware of "the concerns raised about the proposals". Watch: Beth Rigby explains welfare reforms made earlier this year Kendall also pointed out that 90% of those claiming PIP when the changes come into effect in November next year will "not be affected by the end of the parliament". Defending the reforms, Kendall also hit out at "populist politics". She said: "People in this country rightly demand change, but populist politics, the politics of division and easy but empty solutions won't deliver the change people are crying out for. "They need real hope, built on real solutions. And that is what this Labour government is doing." She concluded that change "of this scale isn't easy, but it is possible".
