Labour has been accused of abandoning welfare cuts after admitting that its flagship review of disability benefits will save no money.
A review of the Personal Independence Payments (PIP) will not look at ways to bring down the ballooning cost of the benefit, official documents reveal. Instead, it will only ensure the system is “fair and fit”.
Sir Mel Stride, the shadow chancellor, said it showed “Labour have thrown in the towel on welfare reform”.
Paul Johnson, the former director of the Institute for Fiscal Studies, said the admission “confirms [the Government] has given up on any savings from PIP”, which is projected to cost taxpayers £30bn a year by the end of the decade.
The revelation will fuel fears of significant tax increases in next month’s Budget as Rachel Reeves struggles to rein in runaway government spending. Economists believe the Chancellor must find as much as £40bn in either tax rises or spending cuts to fix her plans.