Labour civil war erupts as Rachel Reeves savaged by MPs over welfare cuts

Furious Labour MPs have demanded Rachel Reeves U-turns on her welfare reforms amid threats of a Commons rebellion.

The Chancellor has faced pleas from Labour’s MPs to reverse cuts to health and disability benefits, amid warnings they will lead to increased poverty.

The Government’s benefit cuts are set to push 250,000 people into relative poverty by the end of the decade.

This includes 50,000 children, the Government’s own impact assessment has said.

Left-wing MPs, Richard Burgon and Kim Johnson have already vowed to vote against Labour's planned benefit cuts.

Mr Burgon said: “This Statement contains cruel attacks on disabled people. The Government is taking the easy option of cutting support for millions of vulnerable people rather than making the wealthiest pay.

“I’ll vote against these cuts to disability benefits. The Government must drop them.”

Ms Johnson said: “Today’s Spring Statement confirms our worst fears. Cuts to PIP and Universal Credit will devastate my constituents. I’ve already received panicked calls and emails from people who simply don’t know how they’ll survive.

“In Liverpool, we know the reality of austerity, poverty and government neglect. We’ve lived through it before and now, under a Labour government, it’s back.”

She added: “I will be voting against any Government legislation to enact these changes. I cannot support measures that will make our most vulnerable poorer and widen inequality across the country.”

A former Labour MP has asked Rachel Reeves, who “has accepted £7,500 worth of free clothing and recently took freebie tickets to see Sabrina Carpenter”, whether Wednesday’s spring statement represents the “change” promised at last year’s general election.

Zarah Sultana, the independent MP for Coventry South, told the Commons: “Since Labour came into power, 25,000 more children have been pushed into poverty due to the two-child benefit cap and now, according to the Government’s own impact assessment, over 250,000 people will be pushed into poverty as a result of these cuts, including 50,000 children.

“So I ask the Chancellor, who earns over £150,000 annually, has accepted £7,500 worth of free clothing and recently took freebie tickets to see Sabrina Carpenter, does she think ‘Austerity 2.0’ is the change people really voted for?”

Ms Reeves said the national living wage would rise from next month, adding: “There’s nothing progressive and there’s nothing ‘Labour’ about pouring more money into a broken system. Under the changes that we’re bringing about, we’re going to help young people who are not in education, employment or training by giving them targeted support.

“And as I set out in the statement earlier, the OBR (Office for Budget Responsibility) so far have not scored any of the back-to-work programme – which is the biggest back-to-work programme that we’ve seen for many, many years.

“They’re going to do that work over the autumn, but we know that the best way to lift people out of poverty is to get them into good work, secure work, paying a decent wage.”

Until now, the Government had also refused to reveal how many people will lose Personal Independence Payments.

But the number has been revealed to be 800,000, including people who would have received the benefit in the future but now won't.

Jon Trickett, a veteran Labour MP, said he will not vote for the Government’s benefit cuts.

He claimed ministers were effectively “picking on disabled people” and Rachel Reeves should look elsewhere to save money.

Ms Reeves used the spring statement to confirm further pressure on the welfare budget, which follows cuts to the disability and incapacity bill set out earlier this month.

The Government expects the measures to save £4.8 billion rather than the more than £5 billion in 2029/30 hoped for by ministers.

The document, published on Wednesday after Chancellor Rachel Reeves delivered her spring statement in parliament, said: “The potential impact of these reforms on poverty projections has been estimated using a static microsimulation model.

The document stated the estimate does not include the impact of the £1 billion annual funding, by 2029/30, for measures supporting people into work “which we expect to mitigate the poverty impact”.

It added that its analysis does not take into account new protections for those with severe lifelong conditions that the Government intends to bring forward.

Labour MP Debbie Abrahams, who chairs the Work and Pensions Committee, told the Commons: “I recognise the difficulties that (Ms Reeves) is facing in terms of fiscal challenges and so on that she inherited and I also support the reforms (Work and Pensions Secretary Liz Kendall) has set out.

“But all the evidence is pointing to the fact that the cuts to health and disability benefits will lead to increased poverty, including severe poverty, and worsened health conditions as well.

“How will making people sicker and poorer help in terms of driving our economy up and people into jobs?”

Ms Reeves replied: “In the green paper we’re consulting on a premium payment for the most severely sick and disabled because as a Government we believe that those people need support should get it.

“But like (Ms Abrahams) I recognise that there are many people who are sick and disabled, there are many young people who could be working but were written off by the previous government and that’s why we’re putting record investment in helping getting those people back to work, with guaranteed, personalised and targeted support.

“You’re half as likely to be in poverty if you’re working, if you move from welfare into work and we’re determined to lift people out of poverty by ensuring there are good jobs paying decent wages with a security that’s guaranteed through the Employment Rights Bill.”

Labour MP Rachael Maskell recognised the importance of fiscal responsibility before adding: “However, as a Labour Party we’ve got an additional responsibility around having social responsibility.

“So can we look at the DWP (Department for Work and Pensions) changes again? Of course protecting the most vulnerable, but it’s those people just above that band which are set to lose and we’re really worried about those.”

Ms Reeves, in her reply, said: “I share the deep concern of all of us on this side of the House, I think everyone in the chamber shares the concern about the most sick and disabled who need support, which is why in the green paper we’re consulting on an additional premium payment for the most severely disabled.”