Home Business News‘The Labour way’: More tax, more welfare and more borrowing as benefits bill heads towards record high

‘The Labour way’: More tax, more welfare and more borrowing as benefits bill heads towards record high

4th Nov 26 1:02 pm

Labour has refused to commit to reducing Britain’s record welfare bill during the current Parliament, as ministers face mounting pressure over a spending trajectory that could see annual benefits costs reach £431bn by 2031–32.

The Government’s reluctance to set a timetable for bringing the bill down was exposed in a heated exchange at Deputy Prime Minister’s Questions, where Conservative deputy leader Alex Burghart challenged First Secretary of State Louise Haigh to promise concrete reductions.

Burghart asked whether Labour would commit to reducing what he described as “the highest welfare bill ever” as part of its 10-year plan.

Haigh insisted ministers were already taking action. “We are taking steps already to bring the welfare bill down, and we’ll take further,” she said, without specifying when spending would begin to fall.

“This Labour government is committed to tackling it all, and no matter what he brings, we are taking steps to deliver all of it,” she added.

But Burghart accused the Government of avoiding the central question, pointing to official projections showing welfare spending rising throughout the Parliament.

“I am sure the right honourable lady was paying attention to the budget and the figures that were published. Welfare spending will go up every single year of this Parliament,” he said.

The figures underline the scale of the challenge facing ministers. Annual welfare spending is forecast to increase from £333bn today to £431bn by 2031–32, a rise of almost £100bn that threatens to intensify pressure on the public finances.

The confrontation follows an admission last week by Chancellor John Healey that the Government has not promised to reduce the overall bill during this Parliament.

“It’s not correct to say that we’re going to bring this welfare bill down in this Parliament because we’ve not set a timetable for that,” Healey said.

That distinction has become increasingly difficult for Labour to defend politically. Ministers have repeatedly insisted they are committed to controlling benefits spending, but have stopped short of specifying when the total will decline or how quickly savings will be delivered.

Burghart accused the Government of lacking the political courage to make difficult choices, describing its approach as “more tax, more welfare and more borrowing”.

He said ministers understood what decisions were required but did not “have the bottle to do it”.

“If Labour doesn’t want to do the right thing, why doesn’t it get out of the way?” he asked.

Haigh countered by highlighting Labour’s interventions on energy bills, business rates and bus fares, while blaming the previous Conservative administration for leaving behind a difficult economic inheritance.

In a pointed attack on the Tories, she said: “The only Government that has had more of an impact in a shorter space of time was the one he served in under Liz Truss.”

But the exchange did little to resolve the underlying question: whether Labour is prepared to take politically difficult decisions to contain a benefits bill that is projected to keep rising.

Burghart warned that welfare spending had reached unprecedented levels, eclipsing those seen during the Covid-19 pandemic and exceeding government spending on policing, schools and defence.

For Labour, the dilemma is increasingly stark. Cutting spending risks a confrontation with claimants and groups dependent on state support, while allowing the bill to rise leaves less room for investment in public services and other priorities.

Ministers say they are committed to tackling the problem. What they have yet to provide is a timetable — or a clear promise that the record bill will be lower by the end of this Parliament.

Leave a Comment

You may also like

CLOSE AD

Sign up to our daily news alerts

[ms-form id=1]