Theresa May ‘rules out’ cuts to welfare budget

Posted On: 
13th September 2016

Theresa May has reportedly ruled out any further cuts to the welfare budget during the life of this parliament.

Department for Work and Pensions building in Westminster

Former Work and Pensions Secretary Stephen Crabb told MPs in March the Government had “no further plans” to make welfare savings before 2020 following the climbdown over cuts to disability payments by George Osborne.

With both Cabinet ministers no longer in Government, the pledge was left up in the air under Mrs May’s administration.

Nick Clegg: George Osborne cut welfare to boost Tory popularity

Treasury pressure leading DWP to pass welfare laws without evidence, says government adviser

Welfare benefits campaign receives cross party support

But the Times reports that Damian Green, who succeeded Mr Crabb in the Department for Work and Pensions, has pledged to hold the Treasury to the deal because it was outlined to the House of Commons.

“The deal still stands,” a DWP source told The Times. “We are working on the basis of there being no new benefit cuts.”

Downing Street last night said: “There has been no change in policy”.

Chancellor Philip Hammond will deliver his plans in the Autumn Statement on 23 November.

Speaking in March, Mr Crabb confirmed that the controversial £4.4bn in cuts to the Personal Independence Payment would not go through.

His announcement that the funding shortfall would not come from the DWP budget meant the Treasury will have to look elsewhere to either cut spending or raise taxes to fill the hole. 

He also said the cap on overall welfare spending would be "reassessed" by the Office for Budget Responsibility at the Autumn Statement later this year.

The cuts to PIP and the pressure of the welfare cap were factors cited by Iain Duncan Smith in his dramatic resignation as Work and Pensions Secretary earlier this year.