Keir Starmer is facing demands for even more concessions to defuse a disastrous Labour welfare revolt today.
As ministers water down a string of changes to benefit cuts designed to head-off a major rebellion, one of the ringleaders accused ministers of reneging on a compromise that had been thrashed out.
Debbie Abrahams said the Government had to ‘think again’ to smooth out remaining ‘issues’ with the package that will be put to a vote tomorrow night.
Meanwhile, Sadiq Khan has waded back in to insist the benefits plans still need ‘radical transformation’.
Worries have resurfaced that there could be enough MPs opposed to overturn the government’s huge majority in a crunch vote tomorrow.
In the Commons this afternoon Work and Pensions Secretary Liz Kendall laid out details of the backtracking that was announced on Friday. The offer included guarantees that no current health or disability benefit claimants will be worse off.
That is expected to wipe out £2.5billion of the £5billion of savings Rachel Reeves was hoping for from the package by 2029-30, raising the threat of more tax rises in the Autumn.
But an updated impact assessment today fueled anger on the Left, estimating that the changes will push 150,000 more people into relative poverty.
Ms Kendall told the Commons she is in ‘listening mode’, in a hint that more movement is possible.
But senior Labour MP Sarah Owen suggested a move to protect existing Pip (personal independence payment) claimants from new eligibility criteria and then reviewing the system, the Government risks creating a three-tier benefits system.
Tory leader Kemi Badenoch later piled further pressure on Sir Keir over the welfare rebellion on Labour’s benches.
She confirmed her party would vote against the Government’s legislation, saying: ‘What Labour is doing is not serious welfare reform.
‘Last week we challenged them to cut the welfare budget, to bring in measures that would get people back into work, and to assure us there wouldn’t be new taxes to fill the gap.
‘Keir Starmer has not met those challenges, in fact he’s watered down the small savings Labour were making.
‘We have a government that is incapable of governing. For that reason, we will be voting against the welfare bill tomorrow.’
Speaking ahead of Ms Kendall’s Commons statement, Sir Sadiq he ‘welcomed’ the changes announced by the Government so far.
But he added: ‘I still have serious concerns about these plans. I’ve met too many Londoners who do work, but through no fault of their own need support from the state, and they’re really worried they’ll lose that.
‘The mission of the Labour government should be to support people out of poverty and this Bill still needs radical transformation to be fit for purpose.’
‘I’m hoping today and tomorrow the Government go further to address the concerns many of us have.’
Sir Keir has blamed the G7 in Canada and Nato summit in The Hague last week for failing to address the Labour revolt earlier.
Speaking in the Commons, Ms Kendall pledged that if MPs pass the Bill at second reading tomorrow it will be amended at committee stage.
The original plans restricted eligibility for the personal independence payment (Pip) and cut the health-related element of universal credit.
The changes to Pip will now only apply to new claims from November 2026.
Plans to cut the health-related element of universal credit have also been blunted, with all existing recipients to have their incomes protected in real terms.
Details of a review of the Pip assessment, to be led by disabilities minister Stephen Timms and ‘co-produced’ with disabled people, will also be published.
Draft regulations for the ‘right to try’, to enshrine in law the right for people receiving health and disability benefits to try work without fear of reassessment, will also be laid in Parliament.
The Work and Pensions Secretary said: ‘We must build a welfare system that provides security for those who cannot work and the right support for those who can. Too often, disabled people feel trapped, worried that if they try to work, they could lose the support they depend on.
‘That is why we are taking action to remove those barriers, support disabled people to live with dignity and independence, and open routes into employment for those who want to pursue it.
‘This is about delivering a fairer, more compassionate system as part of our Plan for Change which supports people to thrive, whatever their circumstances.’
Some £300million in employment support will also be brought forward over the next three years.
Those with severe conditions who are unlikely to recover – about 200,000 people – will not be called for a reassessment of universal credit.
From next year to 2030, all those who already receive the health element of universal credit and new claimants with severe conditions and 12 months or less to live will see an annual rise to their combined standard and limited capacity for work allowance at least in line with inflation.
Ms Kendall told the Commons: ‘We will be delivering a total of £600million for support next year, £800million the year after, and £1 billion in 2028-29, increasing our total spending on employment support for sick and disabled people to £3.8billion over this Parliament, because disabled people who can work shouldn’t wait to have the same rights and chances to work as everybody else.
‘And the measures we are announcing today will cost around £2.5billion in 2029-30.’
She said ‘the overall savings and costings’ of the reform package ‘will be certified by the OBR (Office for Budget Responsibility) in the normal way’.
Ms Kendall had confirmed concessions to the plans after 126 Labour backbenchers signed an amendment that would have halted the Universal Credit and Personal Independence Payment Bill at its first Commons hurdle.
That is now expected to be withdrawn after the move appeased some rebellious MPs.
But others are still committed to backing a similar amendment – with ministers refusing to say if rebels would be punished.
The government was dealt a major blow this afternoon when Ms Abrahams said she was still unable to support the proposals.
‘We implore the government to think again’, she told ITV news.
She added: ‘The actual offer that was put to one of the negotiating team wasn’t actually what we thought we had negotiated on Wednesday and Thursday.’
Labour MP Rachael Maskell said she would sign the new amendment aiming to stop the Bill, saying it was not clear how the promised concessions would be brought in.
‘There’s no confidence… we’re being asked to sign a blank check even with these changes,’ she said.
Vicky Foxcroft, who quit as a Labour whip over the reforms, told The Guardian there were ‘areas where I still think there’s need for movement’ and that she had not decided how to vote.
Richard Burgon, the Labour MP for Leeds East, demanded the Government pull the Bill ahead of tomorrow’s debate.
‘Wouldn’t it be better if rather than try to save political face, the Government pulled this artificially imposed deadline of tomorrow,’ he said.
‘It’s important, not that they save face, but that they get it right.’
Olivia Blake, a Labour MP with a disability, told the paper the changes could create ‘an unethical two-tier system that treats two people with the exact same injury or illness differently’.
The Liberal Democrats plan to vote against and have called for the Government to speed up access-to-work decisions to help people enter the workforce.
Deputy leader Daisy Cooper said: ‘Liberal Democrats simply cannot support any measures that make things harder for unpaid carers, disabled people who rely on support with daily tasks in order to stay employed, and those whose disabilities mean that they will never be able to work.
