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Top Tory Says Benefits Freeze "Doesn't Make Any Sense" As Liz Truss Faces Further Rebellion

Top Tory Says Benefits Freeze 'Doesn't Make Any Sense' As Liz Truss Faces Further Rebellion

Kwasi Kwarteng and Liz Truss at Conservative party conference in Birmingham.

4 min read

Dissent is mounting among senior Conservative MPs over Liz Truss's refusal to confirm whether Universal Credit will rise in line with inflation, raising the prospect of further rebellion in the party.

A former party leader and Truss' own leader of the House of Commons are among those who have signaled that they think Universal Credit payments should increase in line with inflation, rather than keep payments at their current level in an effort to curb government spending.  

It has been suggested that benefits will instead rise with earnings, which has led to warnings that this would lead to a real-terms cut for claimants, given how quickly prices are rising. 

Sir Iain Duncan Smith, who led the party between 2001 and 2003 and served as work and pensions secretary under David Cameron, told a fringe event at Conservative Party conference in Birmingham on Tuesday that it “doesn’t make any sense” to not uprate benefits in line with inflation.

“My view is very simply that the support that we give right now, we're going to give out on the cost of living – which is huge a package we should be talking more about – but at the same time, it wouldn't make a huge amount of sense then to withdraw some of that by actually reducing or not uprating benefits at the same time," he told the discussion, hosted by ConservativeHome.

“It doesn't make any sense. Otherwise, the rest of society gets support, but they end up getting less, and relatively they're the ones that need it most.” 

Duncan Smith believed instead that the benefits policy needed to be viewed "in the round" in order to tackle the cost of living crisis. . 

“The reality is right now we want to get people through what is going [...] to be a difficult period during the winter on cost of living,” he added. 

Earlier on Tuesday, former leadership candidate and Truss’s Commons leader Penny Mordaunt told Times Radio that it “makes sense” for welfare to “keep pace” with inflation. 

“I have always supported, whether it’s pensions, whether it’s our welfare system, keeping pace with inflation. It makes sense to do so. That’s what I voted for before,” she explained. 

"We want to make sure that people are looked after and that people can pay their bills. We are not about trying to help people with one hand and take away with another.”

Following Mordaunt's comments, Truss said no decisions had yet been made.

"Of course there will be discussions about the way forward on commitments like benefits," she told reporters on a visit to a construction site in Birmingham this morning.

One Cabinet minister described the current system as having "lots of carrots" to get people into work but suggested there is a need for "a bit more stick". 

Home Secretary Suella Braverman told the Telegraph today: ""We have got lots of carrots to get people into work." 

She added: "But we have got to add more conditionality to the way we administer welfare and a bit more stick to ensure that it actually pays for people to get off welfare and into work".

This is the second policy rebellion Truss has faced in recent days, having already backed down on the plan to scrap the top rate of 45p income tax as announced in Chancellor Kwasi Kwarteng’s mini-Budget. 

Questions are now also being raised as to whether a change in Universal Credit increase to one in line with earnings would clear a Commons vote. 

 Former Cabinet minister Mel Stride, who chairs the Treasury Select Committee, said he would have to "think long and hard" if asked to vote to increase benefits in line with earnings rather than inflation.

He told BBC Radio 4’s Today programme that because the last time benefits were uprated in April they were pegged against the rate of inflation last September, when it was less than a third of what it is now.

"So we're coming off the back actually of a kind of quite a strong real-terms squeeze on those benefits already, so I think that will be a really tough call to make”, Stride added.

 

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