Freezing PIP is our red line, rebel Labour MPs warn Starmer and Reeves

Labour infighting over planned welfare cuts deepened on Thursday as Government insiders accused concerned MPs of “pearl clutching” while rebels demanded a climbdown on plans to freeze personal independence payments (PIP).

No 10 continued its charm offensive to win over MPs worried about plans to save £6bn from the welfare budget with briefings in Downing Street, but several of those attending described it as a “tick-box exercise” with scant details.

Some in Government were showing the strain of fighting a backlash which rebels claimed ranges across different wings of the party and is pushing for a planned freeze in the annual increase of PIP to be scrapped.

The reform plans are expected to be announced in a Green Paper to be published on Tuesday.

A Government source said: “We have been pretty clear for months and months – anyone who had been listening would know that we wanted to focus on helping disabled people into work and we always said that it would include difficult decisions.

“It is odd to me that there is this pearl clutching now from people when anyone who has been listening would have known what our priorities are.”

While MPs are pushing for PIP to be uprated in line with inflation as normal, rather than frozen to save money, the Government is understood to be working on tweaks and concessions that will protect the most disabled and vulnerable people from cuts to their benefits.

The cuts are being planned as Chancellor Rachel Reeves seeks to plug an estimated £11.5bn hole in her finances and meet her fiscal rules in her 26 March Spring Statement. These state that day-to-day spending must be funding by taxation and not borrowing.

‘Millions getting no help to go back to work,’ Kendall claims

The proposals are believed to include cutting sickness and disability benefits in order to persuade people back to work – with benefits increasing for those who are fit to work, and decreasing for those deemed unfit.

Work and Pensions Secretary Liz Kendall MP on Thursday highlighted new data showing 1.8m in the latter category of universal credit are getting no support to find work, a number which has almost quadrupled since the pandemic.

She said: “Millions of people have been locked out of work by a failing welfare system which abandons people – when we know there are at least 200,000 people who want to work, and are crying out for the right support and a fair chance.

“This is Government is determined to fix the broken benefits system we inherited so it genuinely supports people, unlocks work, boosts living standards while putting the welfare bill on a more sustainable footing.”

The Office for Budget Responsibility forecast at the time of October’s Budget that spending on health and disability benefits would rise from £64.7bn in 203-24 to an estimated £100.7bn by 2030.

The eligibility criteria for PIP – which is paid to people whether they are in work or not to help manage a disability – is also set to be tightened, and annual increases frozen for a year.

But rebels have warned that targeting PIP is a step “too far” and are coalescing around “stopping the freeze”, according to one Labour insider.

MPs meanwhile expressed concerns that the planned cuts could hit the wrong people.

“I don’t want to see any of my constituents who are chronically ill or disabled being financially prejudiced,” one said.

“Their lives are hard enough already. We need guarantees for supporting people who can’t get back to work. They are not languishing because of some sort of lifestyle choice but from their misfortune.”

A second MP said: “I don’t think you could be cutting PIP, that is where my buck stops. We shouldn’t be cutting it for anybody who is disabled and is in receipt of it because you will literally be pushing those people further into poverty. I don’t even don’t want to start talking about who’s the most severely disabled and who’s a deserving disabled person. No one should be talking like that.”

A third MP meanwhile suggested there were fears the freeze could continue for more than a year.

“On the PIP freeze on updating, a one year real terms cut is viewed with horror, anything more would just be off the scale for people.”

It came as left-wing campaign group Momentum launched an online lobbying campaign to encourage people to write to their MPs to oppose welfare cuts.

Sir Keir Starmer defended the Government’s plans on a visit to Hull on Thursday.

The Prime Minister said: “The welfare system as it’s set up, it can’t be defended on economic terms or moral terms.

“Economically, the cost is going through the roof. So if we don’t do anything, the cost of welfare is going to go to £70bn per year. That’s a third of the cost of the NHS.

“That’s more than the Home Office and our prisons combined. So we’re making choices here.”