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The Treasury has contested interpretations of Chancellor John Healey’s recent remarks suggesting that the benefits bill would be reduced before the next general election. During an interview on BBC Radio 4’s Today Programme, Healey stated, “There will be, there will be a reduction in the benefits bill, we’ll do that in a Labour way.” However, several Treasury officials clarified that this should not be read as a definite commitment to cut benefits ahead of the upcoming election, with one source indicating that Healey deliberately avoided implying such a promise.
Instead, it appears there is no firm pledge from ministers to reduce the welfare budget by the time of the next general election. Healey emphasized the importance of addressing the rising costs without resorting to abrupt cuts, especially given the financial pressures many people are facing. He commented, “You don’t do that by crude cuts, especially when people are feeling the cost of living pressures,” adding that the government has already been slowing the increase in welfare spending.
The chancellor highlighted that two major reports are due next month, which will help outline the long-term strategy for reforming the welfare system. Healey described the current framework as “unsustainable” and stressed the government’s “moral duty” to support nearly one million young people who are not in work, education, or training. He explained that encouraging young people to accept work or training opportunities is key to reducing welfare expenditure over time.
On the question of welfare cuts before the election, Healey reiterated his view that, “There will be a reduction in the benefits bill, we’ll do that in a Labour way and we’ll do that because it is simply not good for Britain or progressive to have a bigger and bigger benefits bill.” He also stated, “I feel a moral duty to deal with these youngsters that have been written off by previous governments.” The government plans to publish the reports led by Labour minister Sir Stephen Timms on disability benefits and former minister Alan Milburn on young people not engaged in education, employment, or training, by November. Following this, a government response and policy document are expected by year-end, with legislative proposals to follow next year.
Critics have expressed concerns about welfare spending, with the Conservatives accusing Labour of being “addicted to welfare,” and Reform UK stating the recent Budget failed to tackle the “ballooning” benefits bill. Welfare spending is projected to increase by £19 billion this year, reaching £353 billion. According to the Office for Budget Responsibility (OBR), this figure could rise to £431 billion by 2031/32, largely driven by costs related to health and pensioner benefits. Of this forecast, £209.8 billion is allocated for pensioners, including the state pension and winter fuel payments, while £110.7 billion will go toward universal credit and related benefits, and £69.6 billion on disability support such as personal independence payments.
The government has already committed to reforming the state pension triple lock from 2030, and further welfare system proposals are anticipated in the near future
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