Disability benefit cuts: Government prepares for U-turn over plans as Tory backbenchers threaten rebellion

Treasury sources say it is likely the Government will go into 'complete reverse' after £4.4bn cuts provoke growing backlash

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The Government is preparing for a major U-turn over £4.4bn cuts to disability benefits, as Conservative backbenchers threatened to rebel against plans that would leave nearly 400,000 disabled people thousands of pounds worse off

While Downing Street insisted that ministers remained “committed” to the reforms, which will cut support for people deemed to require aids and equipment to help them get dressed or go to the toilet, Treasury sources said it was likely the Government would go into “complete reverse”. 

The cuts to Personal Independence Payments (PIP), which were announced last week and included in George Osborne’s Budget statement, have provoked a growing backbench revolt which could see them defeated in the House of Commons. 

Osborne questioned about disability cuts on Sky News

Senior Conservative MP Sarah Wollaston, chair of the House of Commons Health Committee, told The Independent that voters would be “rightly uncomfortable” with a Budget measure that removed support for disabled people at a time when higher earners have been given a tax break. 

“There is a nuanced argument to be had about PIP, but I do think the Government will have to think again about why they are doing this,” she said.  

“If you can’t bring the disability charities with you need to think again about proceeding.”

The independent Institute for Fiscal Studies (IFS) has said that the cuts to PIP, which will free up £4.4bn over four years for the Treasury, will leave 370,000 people on average £3,500 a year worse off. 

Disability charities, while advocating reform of PIP to ensure interventions are targeted more appropriately, have opposed the cut. 

The Government insists that the overall PIP budget will continue to rise in real terms, but analysis by the IFS indicates that, under current plans, this will not be the case. 

Downing Street said that it would be several months before the “proposals” on PIP were brought before Parliament, after the Education Secretary Nicky Morgan described the cuts as merely a “suggestion” on Thursday night. 

“The government’s position hasn’t changed,” the spokesperson said. “We remain committed to making these much needed reforms. We have got the time now with the proposals out there, before we bring forward legislative proposals, to explain it to colleagues across the House and to engage with disability groups.” 

“This is about making sure that we can get PIP back to what it was originally intended to do, which was to target the most vulnerable and the most in need.”

Corbyn slams Disability budget

But a Treasury source told the Independent that the risk of political damage to the Government, following the announcement of plans to raise the threshold at which people pay the higher band of tax from £43,000 to £45,000, would likely prove too great for the Government to proceed. 

“The change is so complicated that the overall narrative is that this is Tories hitting disabled people to lower taxes for the middle classes,” the source said.

Any reversal of the cuts would require a recalculation of the Chancellor’s budget proposals. Conservative MP Andrew Percy has proposed the Government consider adding “a penny or two” to fuel duty, rather than proceed with the PIP cuts. 

Although a Department for Work and Pensions consultation on the reforms has closed, Work and Pensions Secretary Iain Duncan Smith this week wrote to MPs insisting that the Government was “continuing to talk to disability groups and colleagues about the best way to do this before bringing forward legislation”. 

The number of people who qualify for PIP support had tripled in 18 months, he added. 

Labour’s Shadow Work and Pensions Secretary Owen Smith said the Government should “come clean on its intentions” and allow a full vote in the House of Commons on the reforms.