Benefits Bill: Labour told to axe Universal Credit reform after PIP U-turn as Britons face 'hardship'

Mel Stride hits out a 'chaotic' welfare reforms ahead of crunch benefits bill vote: 'Taxpayers will pay the price!'
GB NEWS
Patrick O'Donnell

By Patrick O'Donnell


Published: 01/07/2025

- 20:35

Updated: 01/07/2025

- 21:49

The Government is being called to reconsider its proposed changes to the health element attached to Universal Credit

Labour is being urged to drop proposed reform to Universal Credit following this evening's benefits bill U-turn as Britons face being "pulled into hardship".

The Government's welfare legislation cleared its initial parliamentary test tonight, passing by 335 votes to 260, only after secured victory only after abandoning plans to reform Personal Independence Payment (PIP).


The Universal Credit and Personal Independence Payment Bill advanced through its second reading following significant last-minute concessions from ministers.

Notably, the Government completely withdrew the clause relating to PIP changes, where officials had anticipated achieving substantial savings.

Universal Credit sign and Keir Starmer

Labour is facing calls to drop Universal Credit reform

GETTY

This retreat from Labour came after sustained pressure from backbench MPs and disability rights campaigners who opposed the reforms.

Stephen Timms, the Social Security and Disability Minister, made the announcement with barely an hour remaining in the Commons debate.

He confirmed that PIP reforms, which were set to tighten the benefit's eligibility criteria, would be postponed pending a comprehensive review of the system.

The minister told MPs the review would report by autumn 2026 and would be "co-produced" with disabled people. This approach leaves open the possibility that the changes may never be implemented at all.

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Despite securing passage of the bill, criticis note Prime Minister Keir Starmer's Government has seen its authority undermined by the need for such substantial concessions.

Thomas Lawson, the CEO of anti-poverty charity Turn2us, expressed mixed reactions to the vote's outcome.

"We are deeply disappointed that MPs have today voted for this Bill to proceed," he stated.

Whilst welcoming the Government's decision to delay PIP changes pending review, Lawson warned about the impact on Universal Credit recipients.

He highlighted that halving the health element would mean "people who become unwell in the years ahead are even more likely to be pulled into hardship".

Lawson praised the PIP concession as "a huge win for the disabled people, carers, families, MPs and supporters who bravely and passionately spoke out".

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However, he argued the Government had "now removed any doubt that its proposed cuts are not thought-through".

Charlotte Gill, head of campaigns and public affairs at the MS Society, added: “We thought last week’s so-called concessions were last minute. But these panicked 11th hour changes still don’t fix a rushed, poorly thought-out Bill.”

Jon Sparkes, chief executive of learning disability charity Mencap, said: “The last-minute change relating to the review Sir Stephen Timms is leading sounds positive and we are pleased that the Government has listened.”

He added: "Disabled people should not have to pay to fix black holes in the public finances."