DWP leader lays groundwork for additional benefit reductions while Starmer cautioned about expenditures

The Labour Party appears to be opening the door to potential future reductions in disability benefits, as a senior minister declined to dismiss the possibility of revisiting previously controversial proposals. During a session with a cross-party committee, Work and Pensions Secretary Pat McFadden stated that he was not ruling out anything regarding possible benefit cuts. He explained, I have only been in this position for three months, and ruling things out now would unnecessarily limit future options.

Earlier this year, Labour faced strong backlash over its plans to alter the assessment criteria for the Personal Independence Payment (PIP), effectively making it more difficult to claim. This benefit, which currently supports 3.8 million people, is intended to help cover extra costs associated with living with a disability or illness. Following opposition from campaign groups, politicians, and more than 100 Labour MPs threatening to vote against the government, the proposals were withdrawn in late June.

The retreat was announced by Sir Stephen Timms during debates over the legislation, alongside the initiation of a new review into PIP that he is leading. The disability and social security minister had assured MPs in August that this review was not intended to produce cuts. However, by the end of October, the reviews terms of reference were updated to clarify that it will operate within the Office for Budget Responsibilitys (OBR) projections for future PIP expenditure.

When questioned by the Work and Pensions Committee about this adjustment, McFadden stated, The purpose of the Timms Review cannot be to generate more expenditure on PIP. It must remain within the governments budgetary and fiscal constraints.

These statements precede Labours critical second autumn Budget, accompanied by an early OBR report warning that new policy measures under Rachel Reeves could increase spending by 11 billion in 2029/30, mainly due to reversing welfare cuts and abolishing the two-child benefit cap. Following the fiscal announcement, Sir Keir Starmer reaffirmed plans to reform the welfare state, noting that the welfare bill had risen significantly under the previous government.

The Prime Minister highlighted a review led by Alan Milburn addressing the growing number of young people not in employment, education, or training (NEETs), which he described as a massive waste of potential. An official spokesperson indicated that the Milburn review is expected in spring 2026, with its final report in summer 2026, while the Timms review is set to conclude by autumn 2026. They stressed the importance of carefully conducting these reviews to ensure welfare spending remains sustainable.

James Taylor, Strategy Director at the disability equality charity Scope, emphasized the significance of the review: PIP faces genuine challenges, including flawed assessments and a lack of trust between assessors and disabled claimants. This review will shape the future of PIP, so it is essential to get it right. While it is positive that disabled experts will be central to the process, the government must uphold its commitment to co-produce reforms. This process should not be used to limit access to PIP or other benefits.

A Department for Work and Pensions spokesperson added: Our goal is a welfare system that supports those in need while encouraging employment and ensuring fairness for taxpayers. The Timms Review aims to ensure PIP is fair and sustainable, with disabled people and their representatives directly involved in its development.

Author: Sophia Brooks