Keir Starmer is wrestling to restore his grip on Labour today as loyalists vent fury at rebel ‘pr**ks’ who forced his latest U-turn.
Tensions are running high after a massive revolt saw the PM offer major concessions to salvage flagship legislation on health and disability benefits.
Sir Keir was left personally begging MPs to back the government after more than 120 MPs vowed to kill the plans in a crunch vote on Tuesday.
A deal announced after midnight includes guarantees that existing claimants will not lose money. It is expected to wipe out around £3billion of the £5billion savings the Treasury had hoped to get from the reforms – hardening fears that Rachel Reeves will have to hike taxes again in the Autumn.
There have been claims of shouting matches between whips and rebels, with much fury targeted at Sir Keir’s chief of staff Morgan McSweeney and ‘over-excitable boys’ running No10.
Some critics have even demanded ‘regime change’, eliciting an humiliating public denial from the PM that he might have to quit after failing to ‘read the room’.
A Cabinet source told MailOnline that No10 had been wrong to sell the plans initially as a package of cuts, even though polls showed that was popular with the public. ‘They should have stressed to MPs it was the only way ensure the welfare state still exists in a few years,’ the source added.
Keir Starmer has handed major concessions to rebels in a desperate bid to salvage flagship legislation on health and disability benefits
Rachel Reeves was already struggling to balance the books with the economy stalling and the previous U-turn on winter fuel allowance
There have been claims of shouting matched between whips and rebels, with much fury targeted at Sir Keir’s chief of staff Morgan McSweeney and ‘over-excitable boys’ running No10
One Labour veteran told MailOnline that new MPs had proved harder to talk around. ‘There are some who think this is going to be their only term in government now, so why give up on principles,’ they said.
Government insiders were taken aback by the intensity of the revolt, but voiced optimism that the situation was now back under control.
Acknowledging tempers had frayed, they suggested both sides had been engaging constructively by last night. ‘It’s the Parliamentary Labour,’ one added. ‘It has cleared the air.’
Underlining the animosity that had erupted in recent days, a Cabinet source told the Times: ‘I cannot express the disdain I have for these stupid pr**ks who knocked a few doors and think they’re JFK because Keir ran the best election campaign in 30 years.’
Another Downing Street insider reportedly said: ‘It’s deeply unserious stuff from deeply unserious people. They are sounding the death knell of the Labour Party and they don’t even realise it.’
Despite the sound and fury in Labour ranks, the concessions look like being enough to prevent a disastrous defeat for the government at second reading.
However, the changes are estimated to wipe more than £3billion off the £5billion savings by the end of the Parliament. That would be made up of £2billion for Personal Independence Payment (Pip) and another £1billion for the Universal Credit tweaks.
Ms Reeves was already struggling to balance the books with the economy stalling and the previous U-turn on winter fuel allowance.
Ruth Curtice of the Resolution Foundation think-tank suggested Ms Reeves will not be able to find the money in existing budgets.
‘That leaves only extra borrowing – which the Chancellor doesn’t have much space for unless she were to change her own fiscal rules – or tax rises,’ she told BBC Radio 4’s Today programme.
Asked if that effectively meant there would be tax rises, Ms Curtice said: ‘Yeah. Unless the government were to get better news on the economy the next time the OBR does a forecast… but when we look at everything that’s happened in the world since they last did that in March our estimate is that they will actually get bad news from the OBR as well.’
Challenged how the costs would be covered, health minister Stephen Kinnock told Times Radio: ‘The full details around what we are laying out, what I’ve summarised really today, is going to be laid out in Parliament, and then the Chancellor will set out the budget in the autumn the whole of the fiscal position and this will be an important part of that.
‘But forgive me, I’m not in a position to set those figures out now.
‘I think that is very much the Chancellor’s job as we move into the budget in the autumn.’
Unveiling the concessions overnight, a spokesperson for Number 10 said: ‘We have listened to MPs who support the principle of reform but are worried about the pace of change for those already supported by the system.
‘This package will preserve the social security system for those who need it by putting it on a sustainable footing, provide dignity for those unable to work, supports those who can and reduce anxiety for those currently in the system.
‘Our reforms are underpinned by Labour values and our determination to deliver the change the country voted for last year.’
The Government’s original package restricted eligibility for the personal independence payment (Pip), the main disability payment in England, and limited the sickness-related element of universal credit.
Existing claimants were to be given a 13-week phase-out period of financial support in an earlier move that was seen as a bid to head off opposition by aiming to soften the impact of the changes.
In her letter, the Work and Pensions Secretary said: ‘We recognise the proposed changes have been a source of uncertainty and anxiety.
‘We will ensure that all of those currently receiving PIP will stay within the current system. The new eligibility requirements will be implemented from November 2026 for new claims only.
‘Secondly, we will adjust the pathway of Universal Credit payment rates to make sure all existing recipients of the UC health element – and any new claimant meeting the severe conditions criteria – have their incomes fully protected in real terms.’
She said a ministerial review would ensure the benefit is ‘fair and fit for the future’ and will be a ‘coproduction’ with disabled people, organisations which represent them and MPs.
‘These important reforms are rooted in Labour values, and we want to get them right,’ she said.
The change in Pip payments would protect some 370,000 existing claimants who were expected to lose out following reassessment.
Work and Pensions Secretary Liz Kendall sent a letter setting out the concessions last night
If the legislation clears its first hurdle on Tuesday, it will then face a few hours’ examination by all MPs the following week – rather than days or weeks in front of a committee tasked with looking at the Bill.
The so-called ‘reasoned amendment’ tabled by Treasury select committee chairwoman Dame Meg Hillier had argued that disabled people have not been properly consulted and further scrutiny of the changes is needed.
She said: ‘This is a good deal. It is massive changes to ensure the most vulnerable people are protected… and, crucially, involving disabled people themselves in the design of future benefit changes.’
While the concessions look set to reassure some of those who had been leading the rebellion, other MPs remained opposed before the announcement.
