Keir Starmer’s government faced significant criticism following the second reading of its main welfare bill on Tuesday evening, where it passed with a majority of 75 votes, securing 335 votes against 260. The result has opened up a fascinating discussion in the Labour Party. This debate was sharpened by the government’s backtracking on winter fuel payments, increasing spending by some £1 billion. Senior Labour official Pat McFadden defended the government’s actions and the role of party members amidst growing concerns about the implications of the bill on vulnerable populations.
The bill’s march through the legislative process has been characterized by considerable controversy, especially surrounding the impact it would have on increasing poverty. According to the government’s own analysis, it is projected that 150,000 of the most vulnerable individuals may fall into relative poverty as a direct result of the bill’s provisions. This shocking news has sent everyone from party members to social welfare advocates into a tizzy.
The government has abandoned its previous proposals to cut £5 billion a year by reforming the Personal Independence Payment (PIP). This new decision adds further complexity to budgetary estimates ahead of the fall budget. McFadden recognized that such changes would require a reimagination of revenue models.
“This is a difficult process. I’m not going to deny that,” McFadden stated, emphasizing the complexities involved in navigating the welfare changes. He noted that concessions made during the bill’s preparation were necessary to secure its passage but warned of the financial ramifications.
“In any budgetary decision, there’s definitely a cost to what was announced yesterday, and you can’t spend the same money twice, so more money spent on that means less for some other purpose,” – Pat McFadden
The fight over the failed welfare bill has added to the deep fissures within the Labour Party. That’s best illustrated by the fact that 49 Labour MPs voted against the second reading, which is more than three times as many as previous rebellions. The majority of these dissenters were members of their party’s left flank. This points to an increasing chasm in public sentiment on welfare reforms.
While none of the select committee chairs responsible for last week’s rebellion voted against the bill, it’s unclear if they will vote in favor. This decision vividly illustrates the chasm between the leadership of the party and its increasingly leftward base. McFadden further brushed aside concerns about Liz Kendall’s status inside the federal government, expressing confidence in her competence and passion for her work.
“She can carry on because she is an excellent person to do this job. She cares passionately about these issues. She has enormous courage and because most of all, we stand as a team. We stand together as a team. We won the election as a team, and we serve in government as a team,” – Pat McFadden
The handling of the welfare bill has prompted scrutiny of Downing Street’s political operations and raised questions about Labour’s future direction under Starmer’s leadership. Helen Miller, head of the Institute for Fiscal Studies think tank, said private new tax increases were looking increasingly likely. The new fiscal environment bolsters this perspective.
“By the end of this parliament the government will save nothing,” – Helen Miller