An additional 50,000 children could be pushed into poverty as a result of welfare cuts, according to the government’s own impact assessment.
Documents published following Rachel Reeves‘ spring statement, where she confirmed previously announced changes to the welfare system, laid out the numbers who are likely to be affected.
The Department for Work and Pensions (DWP) estimates another 250,000 people – including 50,000 children – could be pushed into relative poverty in the financial year ending 2030.
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Overall, 3.2 million families are expected to lose an average of Β£1,720 by the end of 2030 due to the changes.
The figures are likely to cause further disquiet among Labour backbenchers, who had already expressed concern at the cuts when they were announced by Work and Pensions Secretary Liz Kendall last week.
Speaking to Sky News, Labour MP Rachael Maskell said the spring statement confirmed her “worst fears”.
She criticised the “significant cuts” to Personal Independence Payments (PIP), one of the main types of disability benefit, describing it as a “lifeline for so many people in work and out of work”.
Ms Maskell – who said she was prepared to vote against the changes – said they would have a “catastrophic impact on some of the most vulnerable in our society”.
She said her colleagues were “worried about their constituents who are vulnerable – we see them in our surgeries, and we see them on our streets”.
“We need to reassure them that we have their back,” she added.
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Welfare cuts ‘confirm my worst fears’ – Labour MP
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The chancellor earlier confirmed she would have to implement more welfare savings than she had initially planned after the Office for Budget Responsibility (OBR) said reforms announced last week would save Β£3.4bn instead of the Β£5bn ministers thought.
To make up the shortfall, Ms Reeves said the health element of universal credit would be cut by 50% and frozen for new claimants rather than rising with inflation.
However, the universal credit standard allowance will increase from Β£92 per week in 2025-26 to Β£106 per week by 2029-30.
Asked about the poverty figures in a press conference after the spring statement, Ms Reeves said the impact assessment did not take into account measures the government was taking to get people back into work.
She said: “We’re confident that the changes that we are making and the support that we’re providing to get people into work will result in more people having fulfilling careers, paying decent wages.
“And that is the best way to lift families out of poverty.”
Other key findings in the impact assessment include:
- The PIP caseload will be cut by 400,000 in 2029/30, but is still expected to grow by over 750,000 over the next five years
- Around 370,000 PIP recipients are expected to lose their entitlement
- More than two million recipients of the universal credit health element will be affected by the freeze – with the average loss Β£500 per year
- A further 150,000 people will not receive carer’s allowance or the universal credit carer element as a result
Changes described as ‘cruel’ by dissenting Labour MPs
The mood has darkened among Labour MPs as the impact assessment – for the cuts announced by Welfare Secretary Liz Kendall last week – was unveiled by the Department for Work and Pensions.
Labour MPs privately described it as “cruel” and “very difficult”.
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“We are doing this to make the numbers add up for the OBR,” they said, although they added that MPs understood the huge growth in benefit claims had to be addressed.
Ministers have insisted the impact did not take account of measures to help some of those families into work (although many recipients of personal independence payments are in work), or the impact on children of free breakfast clubs and falling childcare costs.
Sources close to Liz Kendall said she was pleased with the Β£1.4bn the chancellor had put into employment support to help people back into work – the biggest package in years.
‘We don’t want child poverty increasing’
In the Commons, there were early signs of a backlash among Labour MPs.
Debbie Abrahams, MP for Oldham East and Saddleworth and the chair of the work and pensions select committee, said: “All the evidence points to cuts in welfare leading to severe poverty and worsened health conditions. How will making people sicker and poorer get people into jobs?”
Richard Burgon, MP for Leeds East, said: “Making cuts instead of taxing wealth is a political choice, and taking away the personal independence payments from so many disabled choice is an especially cruel choice.
“A disabled person who can’t cut up their own food without assistance, and can’t go to the toilet without assistance, and can’t wash themselves without assistance will lose their personal independence payment.”
