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The Chancellor Rachel Reeves has insisted she is “absolutely certain” the welfare reforms will not drag people into further poverty, dismissing reports from Labour and opposition MPs and campaigners.
Rachel Reeves has said there will not be any more tax rises or even spending cuts later this year during the Autumn Budget, but the Chancellor stopped short of not ruling them out.
The government’s own impact assessment of the welfare reforms warns that around 250,000 people plus 50,000 children may fall into poverty due to the Chancellor’s sweeping reforms.
Around 370,000 people who are currently receiving disability benefits will lose an average of £4,500 per year in 2029/2030 amid the welfare cuts to rake in £5 billion.
The Chancellor told Sky News, “I am absolutely certain that our reforms, instead of pushing people into poverty, are going to get people into work.
“And we know that if you move from welfare into work, you are much less likely to be in poverty.
“That is our ambition, making people better off, not making people worse off, and also the welfare state will always be there for people who genuinely need it.”
The Resolution Foundation’s research director James Smith said the 2020s are becoming a “disaster” for living standard in the UK.
The think tank said the current parliament from 2024-2029 is forecast to be the third worst on record for people’s disposable incomes.
He warned that the poorest half of income distribution are “basically at recession levels,” and they “project incomes for this group falling about 3% or £500 on average.”
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