The government has won a vote on its benefits bill by a margin of 75 votes, but only after offering last-minute compromises to Labour rebels.
Initially, the government had already softened its plans by reversing some cuts to universal credit and protecting current claimants of personal independence payment (Pip) from stricter eligibility rules.
However, some Labour MPs remained concerned that the new criteria for claiming Pip would come into effect before the recommendations of a review could be implemented.
Fearing a humiliating defeat, the government announced a further change, stating that it would not alter Pip rules until the review’s conclusions had been considered.
These last-minute changes significantly weaken the government’s Universal Credit and Personal Independence Payment Bill.
The move undermines the authority of Sir Keir Starmer, who has faced criticism for a series of recent U-turns, as well as Work and Pensions Secretary Liz Kendall.
It also puts pressure on Chancellor Rachel Reeves’ spending plans, as potential savings of £5bn will now be delayed or lost entirely.
Helen Miller, incoming director of the Institute for Fiscal Studies think tank, said the figures would “fuel speculation over potential tax increases and their magnitude” during the summer.
She raised concerns about the government’s credibility, stating that it does not bode well for addressing the deeper challenges facing the UK’s public finances.
Following the vote, Kendall expressed her disappointment, stating that she wished the government had reached this point in a different manner.
She defended the bill, claiming that it implements important reforms to assist those who are capable of working.
Labour MP Chris Curtis, who supported the measures from the beginning, defended the government’s concessions, stating that it is not a sign of weakness to reconsider one’s position and ultimately reach a better outcome.
After a tumultuous few hours in Parliament, MPs voted 335 to 260 in favor of giving the bill initial approval. This reduced the government’s working majority from 165 to 75.
MPs will continue to scrutinize the bill when it returns to the House of Commons on July 9th.
Initially announced in March, the government’s plans for a shake-up of the benefits system included measures to limit eligibility for Pip and freeze the health-related element of universal credit.
Alongside these measures, the government promised a £1bn support package to assist disabled individuals and those with long-term conditions in finding work.
The government defended these proposals, citing a significant increase in the number of benefit claimants and asserting that changes were necessary to ensure the sustainability of the system in the future.
However, there had been growing discontent among Labour MPs for weeks, with concerns that the bill would push people into poverty.
Last week, over 120 MPs threatened to block the bill, prompting the government to announce changes that would only apply the stricter rules to new Pip claimants after November 2026, rather than existing ones. They also reversed plans to freeze the higher rate of universal credit for current health-related claimants, although new applicants would still receive reduced payments.
While this was enough to convince some Labour MPs, including Dame Meg Hillier who had led efforts to block the bill, others continued to express their opposition.
During the debate on Tuesday, Hillier stated that she would support the bill but warned the government not to disregard the opinions of backbenchers in the future.
However, her colleague Rachael Maskell stated that she would still oppose the bill, stating that these “Dickensian cuts” do not align with the values of the Labour Party.
The pressure from backbench MPs led to disability minister Sir Stephen Timms announcing that the government would only make changes to Pip after the review had concluded.
Despite the multiple concessions, 49 Labour MPs still voted against the bill.
At times during the debate, there was a breakdown of trust between the government and its own backbenchers.
Even those Labour MPs who were persuaded by the Pip concessions stated that they would vote against the bill at a later stage if the government does not follow through on its promises.
There was confusion about what Sir Stephen’s promise to remove tighter Pip tests from the bill would mean in practice, and whether MPs would have a say in the decision.
Following the vote, rebel MP Emma Lewell stated that it was “absolute chaos” and not a serious way to make legislation.
Another rebel, Richard Burgon, stated that if the government does not deliver on its promises, there is still a possibility that the bill could be defeated.
Following the vote, disability rights organizations expressed mixed reactions, with some stating that the changes were positive while others argued that the bill still strips away support for future universal credit claimants.