Rachel Reeves could possibly be forced to increase taxes to plug holes into Britain’s public finances, warned a leading thinking tank, after the government failed to exclude plans to ward off the benefits account.
It comes before the Spring statement by the Chancellor on March 26, where she is expected to make a series of public spending savings to sharpen the fiscal main space and balance the books.
Initial reports have suggested that personal independence payments (PIP) would be frozen to rise with inflation for a year, but the plan is with a strong opposition – and is now expected to be dropped.
After warnings from charities that the plans to reform the welfare system can force thousands of disabled people into poverty and a growing revolt of MPs behind the scenes, the government now seems to be driving the proposals aimed at raising between £ 5bn and 6 billion.
The Resolution Foundation, which called plans to reduce and “chase” well -being, said the government should rather increase taxes to comply with their fiscal rules and to sharpen the fiscal main space – something they argue is the only realistic alternative to the proposed welfare cuts.
James Smith, the research director of the organization, said the cutting of daily expenses is an option, said James Smith, the research director of the organization, said The independent That the ‘struggling state of public services’ will make it difficult to find the large -scale savings needed to meet their fiscal rules.
The thinking tank estimates that the expansion of the threshold freezing on income tax and national insurance would increase £ 8 billion in the last two years of the five -year forecast.
“We would say it’s a reasonable progressive way to raise money. [The government] Will flack for that, but it is technical in accordance with their manifesto statements … it is probably within their red lines and would be enough [to balance the books]”, Mr. Smith said.
In his manifesto, labor promised not to increase VAT, income tax or national insurance contributions for “working people”.
During the weekend, charities warned that welfare plans could force thousands of people into poverty, with Jon Sparkes, CEO of Learning Stremness Charity Mencap, told The independent That the organization “hears deeply disturbing reports of people who feel very tense and anxious about what the changes can mean to them.”
It is clear that the charity had meetings with ministers where they warned them about possible detrimental consequences, but has since been kept in the dark about plans.
While Mr. Smith said that there is a case for reforming benefits, they do not seem to do so, focusing on PIP, not really getting people back to work. ‘
‘These kinds of hasty reforms to benefits tend to deliver on savings, so we are a little worried about it. And this is a very progressive way to make up for the lack of the main space they have. ‘
Meanwhile, Lisa Mainwaring, Turn2us, said that freezing or cutting tip will be “devastating for the disabled, especially since many are already struggling with rising living costs”.
‘PIP is not an obstacle to work, which is what allows people to live independently and stay in work for some. Without it, many are at risk of losing their independence, facing severe mental health and being pushed further into hardship, ”she said The independent.
Ms Mainwaring added: “Every day we hear about the disabled that are afraid of what these cuts can mean … this kind of uncertainty is cruel and unnecessary.
‘People should not have to live for fear of supporting the support that enables them to function. The government can end this panic today by excluding these cuts, but instead is left in Limbo. ‘
Asked about PIP by the BBC Sunday, West Streeting, health secretary, could not say whether the government would freeze the payment this week as part of its welfare reforms.
“I haven’t seen the full plans yet, they haven’t come to the cabinet yet,” he said.
‘But what I do know is the work and pension secretary who wants to support people who are most needed, and we need to make sure that there is a greater variety of support, and that everyone plays their role, too.
“For example, because I with these levels of illnesses, if I can help people to help to health, in many cases I will help them get back to work, and that’s what we will do.”
The government insisted that there is a ‘moral matter’ for the implementation of the package of welfare cuts – but it has drawn the severe MPs and peers of labor.
The concern of MPs arose after Downing Street could not guarantee that the most vulnerable disabled would not be affected by the changes. However, no 10 insisted that it protect “those who cannot work.
The government held a number of meetings with Labor Backbenchers to persuade them of the plans, which caused concerns about the party, with even cabinet ministers divided on the issue.
Sources have since told the BBC that the government is looking at the back retrieval at the PIP rushing point to ward off the impending uprising.
And on Sunday, the government announced that disabled people will have the right to try work without the risk of losing their benefits, in another major franchise in its plan to reduce the welfare bill.
Ms. Kendall is expected to announce legislation to set up a “right to try guarantee” that will prevent people who receive health -related benefits from automatically reconsidering their rights if they are employed.
With the defense of the plans, Mr. Streeting warned that many people in the current welfare system were ‘in a trap of the danger’ because they wanted to return to work, but were afraid that they would not be able to get their benefits back if it did not work out.
A government spokesman said: ‘As part of our plan for change, we put more money in working people’s pockets by raising the national living wages, protecting their pay strips from higher taxes and freezing fuel.
“Our plan is built on stability, reform and investment, which is why we made the right decisions to provide stability to our public finances, and why the chancellor was clear that the government’s commitment to fiscal rules and sound public finances is non -negotiable.”
