Can Labour cut welfare spending and still be seen as a party of social justice?
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Labour’s embrace of plans to reduce the incapacity benefit bill by £3bn has the potential to trigger a backbench revolt. One of the most important takeaways from last week’s high court ruling declaring the government consultation on reform of incapacity benefits to be unlawful was the clarity with which it highlighted the failure of Conservative ministers to be honest about why they wanted the changes, and who will lose out as a result.
The ruling effectively pointed out that the previous administration’s presentation of cuts to incapacity benefit as a positive development for low-income claimants was misleading because it unaccountably neglected to mention 420,000 of them would also be £416 a month out of pocket, and many of them thrust into abject poverty.
While the consultation had emphasised the transformative job opportunities that would potentially become available to sick and disabled claimants once freed from the grip of benefit dependency, it failed to explain that the “primary rationale” of the whole exercise was Treasury spending cuts.
Labour is to rerun that consultation in the form of a green paper expected in the next few weeks, and there is likely to be intense scrutiny of the clarity – and honesty – with which it presents tough policy choices made even tougher by what some would say are the unnecessarily rigid economic rules it has imposed on public spending.
Few object to the need to reform the notoriously poorly designed incapacity benefit system, or to help disabled and chronically ill people get a job if they are able. Things get trickier because Labour has embraced Tory plans to cut £3bn from the incapacity benefits bill by 2028, while also promising to reduce child poverty.
