‘Must-do for any responsible government’ – minister defends surprise extra benefit cuts to feature in spring statement
Good morning. This time last week Stephen Timms, a welfare minister, was doing an interview round to defend the £5bn disability benefit cuts announced the previous day, and he refused to rule out further benefit cuts in the future. Most of us thought he was being careful because of the risk of further cuts later in this parliament, or possibly later this year. I don’t think anyone expected extra cuts to be announced within days.
But that is exactly what has happened. As Heather Stewart, Kiran Stacey and Richard Partington report in the Guardian splash, only hours before the spring statement, the Treasury has revealed that the disability benefit cuts are going to be even deeper than the ones set out last week. That is because the Office for Budget Responsibility, the government’s all-powerful fiscal regulator, has ruled that the Treasury was being unrealistic when it said the benefit cuts would save £5bn. (The OBR is probably right – in the past benefit “crackdowns” have rarely saved as much the Treasury forecasts.). And this means the cuts have to be beefed up, to save another £1.6bn.
The change was first reported by the Times, which says that “universal credit incapacity benefits for new claimants will now be frozen until 2030 rather than increased in line with inflation” and that there will also be “a small reduction in the basic rate of universal credit in 2029”.
Keir Starmer and Rachel Reeves were already facing a strong backlash from Labour backbenchers over the benefit cuts. This development is likely to exacerbate that, although quite how visible that will be today is hard to predict. Many Labour MPs are alarmed about the cuts in private, but have not spoke out publicly.
John Healey, the defence secretary, has been giving interviews this morning, and he has defended what the Treasury is doing. Referring to the assessment that last week’s benefit cuts will only save £3.4bn, not £5bn, he told Times Radio:
I think that’s a calculation that we may see confirmed from the Office of Budget Responsibility about the longer term savings that our plans to change the welfare system may bring, and that’s a must-do for any responsible government, particularly one that believes in the importance of our social security system. Doing nothing is not an option. It’s failing and writing off a young generation.
Today we will be focusing almost entirely on the spring statement. Graeme Wearden, who writes the Guardian’s business blog, will be joining me here later, and we will be covering the statement in detail, and bringing you all the best analysis and reaction.
Here is the agenda for the day.
Noon: Keir Starmer faces Kemi Badenoch at PMQs.
12.30pm: Rachel Reeves delivers the spring statement.
2.30pm: Richard Hughes, chair of the Office for Budget Responsibility, holds a press conference.
4.15pm: Reeves holds a press conference.
If you want to contact me, please post a message below the line or message me on social media. I can’t read all the messages BTL, but if you put “Andrew” in a message aimed at me, I am more likely to see it because I search for posts containing that word.
If you want to flag something up urgently, it is best to use social media. You can reach me on Bluesky at @andrewsparrowgdn. The Guardian has given up posting from its official accounts on X but individual Guardian journalists are there, I still have my account, and if you message me there at @AndrewSparrow, I will see it and respond if necessary.
I find it very helpful when readers point out mistakes, even minor typos. No error is too small to correct. And I find your questions very interesting too. I can’t promise to reply to them all, but I will try to reply to as many as I can, either BTL or sometimes in the blog.
Healey says Vance and Hegseth ‘have got a case’ on EU defence spending, when asked about ‘pathetic freeloader’ jibes
Ever since Donald Trump became US president, Keir Starmer and all his ministers have tried as much as possible to avoid saying what they think about all the things being said and done by his administration (many of which are abhorrent to mainstream UK political opinion). Sometimes Starmer and his team have adopted the line that it is not their job to be “commentators”. (Lynton Crosby used to try the same argument with the Tories.) This has led to many interviews taking a surreal turn, like Angela Rayner’s on the World at One yesterday, where she refused repeated attempts to offer any significant response to JD Vance, the US vice-president, and Pete Hegseth, the defence secretary, denouncing the Europeans as pathetic freeloaders.
But this morning John Healey, the defence secretary, was a bit more forthcoming. In an interview with Times Radio, asked about the Vance/Hegseth argument, he said:
I regard it more of a challenge.
Asked again about the Europeans being described as pathetic freeloaders, he said:
The Americans have got a case, the Americans have absolutely got a case, that on defence spending, on European security, on our support for Ukraine, European nations can and will do more and the UK is leading the way.
I’m proud of that on defence spending, on European security and on Ukraine. It’s why we’re pulling together the coalition.
And in an interview on the Today programme, asked about Trump’s special envoy Steve Witkoff describing Keir Starmer’s Ukraine policy as posturing, Healey did push back against Witkoff’s argument, without criticising him personally. He said:
I’m proud that the UK, alongside France, is leading the coalition of the willing, ready to stand by Ukraine in the event of a negotiated peace just as we have through the war.
And we’re responding to the US challenge to European nations like the UK to do more to support Ukraine.
We’re responding to the requirement of Ukraine to say, ‘look, post-ceasefire, what are the security arrangements that give us the confidence that any negotiated peace will, as President Trump has said, be a durable peace’.
Reeves to announce extra £2.2bn in defence spending from April
John Healey, the defence secretary, has been doing an interview round this morning because overnight the Treasury briefed journalists that Rachel Reeves will announce an extra £2.2bn in defence spending from April in the spring statement. (Presumably that was the story the Treasury press office were hoping would be leading the news bulletins this morning, not the new benefit cuts).
In its news release, the Treasury said:
The chancellor will announce a further £2.2bn funding increase for defence from April, as she warns that Britain has to “move quickly in a changing world”.
The funding will be invested in advanced technologies so that Britain’s armed forces have the tools they need to compete and win in modern warfare. This includes guaranteeing the investment to fit Royal Navy ships with Directed Energy Weapons by 2027. These weapons can hit a £1 coin from 1km away and take down drones at a distance of 5km.
It will also be used to provide better homes for military families by refurbishing the defence estate – including over 36,000 homes recently brought back into public ownership from the rental sector. In addition to this, the funding will unlock rapid preparatory work, such as site surveys, planning and architecture, for the major redevelopment of armed forces housing through the defence housing strategy.
The investment will also help fund upgrades to infrastructure at His Majesty’s Naval Base Portsmouth, securing its ability to support Royal Navy operations into the future.
Defence spending in 2024/25 was around £57bn.
According to the Treasury, in her spring statement speech later Reeves will say:
In February, the prime minister set out the government’s commitment to increase spending on defence to 2.5% of GDP from April 2027 and an ambition to spend 3% of GDP on defence in the next parliament as economic and fiscal conditions allow.
That was the right decision in a more insecure world, putting an extra £6.4bn into the defence budget by 2027.
But we have to move quickly in a changing word. And that starts with investment.
So I can today confirm that I will provide an additional £2.2bn for the Ministry of Defence next year – a further downpayment on our plans to deliver 2.5% of GDP.
This increase in investment is not just about increasing our national security but increasing our economic security, too.
As defence spending rises, I want the whole country to feel the benefits.
UK inflation falls to 2.8% in boost for Rachel Reeves before spring statement
UK inflation has fallen back by more than forecast to 2.8%, providing some positive news for Rachel Reeves before she makes her spring statement, Richard Partington reports.
‘Must-do for any responsible government’ – minister defends surprise extra benefit cuts to feature in spring statement
Good morning. This time last week Stephen Timms, a welfare minister, was doing an interview round to defend the £5bn disability benefit cuts announced the previous day, and he refused to rule out further benefit cuts in the future. Most of us thought he was being careful because of the risk of further cuts later in this parliament, or possibly later this year. I don’t think anyone expected extra cuts to be announced within days.
But that is exactly what has happened. As Heather Stewart, Kiran Stacey and Richard Partington report in the Guardian splash, only hours before the spring statement, the Treasury has revealed that the disability benefit cuts are going to be even deeper than the ones set out last week. That is because the Office for Budget Responsibility, the government’s all-powerful fiscal regulator, has ruled that the Treasury was being unrealistic when it said the benefit cuts would save £5bn. (The OBR is probably right – in the past benefit “crackdowns” have rarely saved as much the Treasury forecasts.). And this means the cuts have to be beefed up, to save another £1.6bn.
The change was first reported by the Times, which says that “universal credit incapacity benefits for new claimants will now be frozen until 2030 rather than increased in line with inflation” and that there will also be “a small reduction in the basic rate of universal credit in 2029”.
Keir Starmer and Rachel Reeves were already facing a strong backlash from Labour backbenchers over the benefit cuts. This development is likely to exacerbate that, although quite how visible that will be today is hard to predict. Many Labour MPs are alarmed about the cuts in private, but have not spoke out publicly.
John Healey, the defence secretary, has been giving interviews this morning, and he has defended what the Treasury is doing. Referring to the assessment that last week’s benefit cuts will only save £3.4bn, not £5bn, he told Times Radio:
I think that’s a calculation that we may see confirmed from the Office of Budget Responsibility about the longer term savings that our plans to change the welfare system may bring, and that’s a must-do for any responsible government, particularly one that believes in the importance of our social security system. Doing nothing is not an option. It’s failing and writing off a young generation.
Today we will be focusing almost entirely on the spring statement. Graeme Wearden, who writes the Guardian’s business blog, will be joining me here later, and we will be covering the statement in detail, and bringing you all the best analysis and reaction.
Here is the agenda for the day.
Noon: Keir Starmer faces Kemi Badenoch at PMQs.
12.30pm: Rachel Reeves delivers the spring statement.
2.30pm: Richard Hughes, chair of the Office for Budget Responsibility, holds a press conference.
4.15pm: Reeves holds a press conference.
If you want to contact me, please post a message below the line or message me on social media. I can’t read all the messages BTL, but if you put “Andrew” in a message aimed at me, I am more likely to see it because I search for posts containing that word.
If you want to flag something up urgently, it is best to use social media. You can reach me on Bluesky at @andrewsparrowgdn. The Guardian has given up posting from its official accounts on X but individual Guardian journalists are there, I still have my account, and if you message me there at @AndrewSparrow, I will see it and respond if necessary.
I find it very helpful when readers point out mistakes, even minor typos. No error is too small to correct. And I find your questions very interesting too. I can’t promise to reply to them all, but I will try to reply to as many as I can, either BTL or sometimes in the blog.
