The welfare bill will go on rising until the next general election, and the net savings Andy Burnham’s reforms are meant to deliver are not expected to appear until around 2030, according to The Telegraph’s reporting on the Government’s planning. Ministers are said to expect the upfront cost of the flagship back-to-work programme to exceed the savings from benefit cuts in every year up to that point.
The sequencing places the first year of expected net savings after the last date on which the next election can be held. Under the Dissolution and Calling of Parliament Act 2022, the current Parliament must be dissolved by 9 July 2029, and the election must take place no later than 15 August 2029. On the assumptions reported by The Telegraph, the Government would be asking voters to re-elect it before the financial case for its central domestic reform had been tested by a single year of delivery.
The fiscal “scoring” of the two policies at the heart of the plan will not be published until the Spending Review, which is expected next summer at the earliest and which the Prime Minister has reportedly considered delaying until the autumn of 2027. If the welfare bill is brought forward on the timetable ministers are said to be planning, MPs would be asked to approve it before the figures that justify it have been placed before them.
Great British PAC believes welfare reform must be built on financial transparency, personal responsibility and genuine opportunities for those who can work, while protecting people who cannot. The British public deserves to know what these reforms will cost, when any savings are expected and whether the Government’s promises are supported by credible Treasury and OBR analysis. Parliament should not be asked to approve major changes to the welfare system without a clear account of their financial consequences.
What the numbers do and do not show
Four different measures are routinely conflated in this debate, and the distinction matters.
Total welfare spending is the whole bill, including the state pension, and it is forecast to rise in cash terms whatever happens to working-age reform. It stood at £314.9 billion in 2024/25 and is projected to reach £408.6 billion by 2030/31, or 11.2 per cent of GDP, according to DWP figures set out in a House of Lords Library briefing. Around 55 per cent of social security spending goes to pensioners. Of the £145 billion spent on working-age and children’s welfare in 2025/26, £77.1 billion went on benefits for disabled people and people with health conditions.
Gross savings are what a specific measure takes out of that total. The upfront cost of employment support is what the Government must spend to deliver the measure. Net fiscal saving is the difference between the two in any given year, and it is the only figure that matters to the Treasury’s sums. A saving measured against a forecast baseline, finally, is not the same as a cash reduction: it means spending ends up lower than it would otherwise have been, not that it falls.
A rising total is therefore compatible with individual reforms producing real savings. The question raised by the reporting is narrower and more serious: whether the reforms the Government is legislating for will produce a net saving within the lifetime of this Parliament. On the assumptions described to The Telegraph, they will not.
The youth numbers explain the urgency. There were 981,000 people aged 16 to 24 not in education, employment or training in April to June this year, 13 per cent of the age group, according to the ONS. The figure reached 1,012,000 in the previous quarter. Some 331,000 people aged 18 to 24 are claiming unemployment-related benefits, almost double the number in 2016, the BBC reported.
The Prime Minister’s argument
Andy Burnham has put the case for reform in the starkest terms available to him. Writing in The Times on Monday, he said benefits would become “the backstop, not the starting point”, and described the near one million young people outside education, employment and training as “an economic catastrophe and a moral failure”. He wrote: “We either invest in the success of our young people or pay for failure through the benefits system. We cannot afford to do both.”
His department puts the current youth employment package at £2.5 billion, with 22,400 apprenticeships a year in accountancy, legal services and consultancy, alongside 40,000 construction placements. The Prime Minister has also promised that the system “will no longer begin by establishing which benefits a young person is entitled to” but will start with their ambitions.
That is a serious argument, and it deserves to be tested on its merits rather than dismissed. If a young person spends a decade on sickness benefits because nobody assessed what they could do, the cost to the Exchequer is exceeded only by the cost to them. Alan Milburn, the former health secretary whose review reports next month, has calculated that £1 is spent on employment support for every £25 spent on benefits for this group, and that 60 per cent of young people classified as NEET have never had a job. “We need to redistribute money from the welfare system to more employment support if we are going to end the NEET crisis,” he told The Guardian. He added: “This is not a workshy, snowflake generation.”
The invest-to-save case is coherent. It is also, by its nature, unproven until the investment has been made and the saving has arrived. What the Government has not published is the year-by-year profile that would allow anyone outside Whitehall to judge whether the trade is worth making.
The sequencing has a history
The order of events is not an accident of the parliamentary calendar. It is the residue of the last attempt to cut the bill.
In July 2025 Sir Keir Starmer’s government brought forward welfare reforms intended to save £5 billion a year by 2030, principally by tightening eligibility for disability and sickness payments. More than 120 Labour MPs threatened to rebel. The Government conceded at the despatch box, the bill passed second reading by 335 votes to 260, the working majority fell from 165 to 75, and 49 Labour MPs still voted against it. Gilt yields rose after the vote and Rachel Reeves, then Chancellor, was visibly distressed at Prime Minister’s Questions the following day, as The Guardian reported.
Two of the MPs closest to that revolt are now at the centre of government. Louise Haigh, described by the BBC as Burnham’s effective deputy, and Anneliese Midgley, his chief whip, were both leading figures in the rebellion. A strategy of promising support first and legislating for cuts second is designed to avoid a second defeat on the floor of the Commons. As political management, it is intelligible. As fiscal policy, it defers the reckoning without removing it.
The reviews point towards the hardest reform
The Timms Review of Personal Independence Payment concluded in its interim report in July that PIP is “no longer fit for purpose”, finding systematic problems in an assessment process that fails to reflect the reality of disabled people’s lives. Sir Stephen Timms has said his review is not a cost-cutting exercise, a position he repeated when MPs questioned him on the report.
Reforming a benefit found to be failing the people who receive it, while also reducing what it costs, is the most difficult operation in social security. It is not achieved by announcing a target. It requires an assessment regime that identifies need accurately, a support system that responds to it, and a savings profile credible enough to survive contact with the OBR.
Both reviews were expected in the autumn. The Milburn review has been pushed back to after the Budget, and reports suggest its publication could slip further. The OBR’s own welfare trends work continues to flag the uncertainty in health-related caseload growth as a material risk to the public finances.
Ministers rule out the obvious, then promise the inevitable
Angela Rayner, the Communities Secretary, told BBC Radio 4’s Today programme on Tuesday that the Government would not impose “arbitrary” cuts on claimants. She said the “big difference” in the Prime Minister’s plans was that Labour would not “put the cart before the horse” by announcing cuts before making the case for wider employment reform.
Rayner defended the 2025 package of £5 billion of benefit cuts from the same position in government, telling the BBC that working-class people do not want handouts. She is now warning against the thing the Government’s own bill must deliver. The Work and Pensions Secretary, Pat McFadden, is reported to be sympathetic to a parallel benefits system for the under-25s, which would require primary legislation. Downing Street’s position is that the bill will contain cuts. Its ministers’ position is that the cuts will not be arbitrary. Neither has said what the difference is in pounds, or which claimants will be affected.
The Spending Review will also carry John Healey’s plan to reach 3 per cent of GDP on defence, a target the Chancellor set for himself as Defence Secretary and resigned over in June when the previous government would not fund it. His first Budget, on 28 October, will not contain it. Kemi Badenoch has drawn the connection directly: “We need to cut welfare to fund defence,” she said, adding that Healey “resigned as Defence Secretary because he could not, in good conscience, preside over a funding settlement of less than three per cent of GDP” (GB News).
The Government’s formal pledge remains 3.5 per cent by 2035. The gap between that commitment, the 3 per cent target the Chancellor set for himself, and the absence of either from next week’s Budget is the clearest illustration of why welfare reform carries such weight in the defence calculation. There is no other line of day-to-day spending large enough to fund it.
What the Opposition would do instead
The Conservatives have published a plan to take £36 billion a year out of the welfare bill, including by restoring the two-child limit that Labour removed from April this year, ending benefits for foreign nationals and restricting disability claims for lower-level mental health conditions. The two-child limit alone is costed by the party at £3.2 billion a year, with half earmarked for deficit reduction and half for defence.
Restoring it would reverse a policy the Government legislated to remove in order to lift 450,000 children out of poverty, on its own estimate. That is a real trade-off, not a technical adjustment, and the Conservative Party has not published the distributional analysis that would show its effect.
Reform UK has gone further, proposing around £50 billion of savings by abolishing PIP for working-age adults and removing the health element of Universal Credit, replacing both with a Health Security Allowance available in cash only to what it calls the most “severe, enduring and high-risk cases”. Some 2.89 million people would have their disability payments removed or modified, the party estimates, with others supported through council-run provision for “verifiable additional costs”.
These are party projections, not independently costed figures, and the BBC appended a correction to its own reporting in August to make that clear. Labour called the plan “fantasy economics, built on stripping support from disabled people”. The Conservatives called it “half-baked”. Both criticisms have force, but neither answers the question the Government must answer: if Reform’s numbers are implausible, what are Labour’s?
The tests that matter
Three dates will settle whether the Prime Minister’s reform is a plan or a postponement.
The Budget on 28 October, which is not expected to contain significant welfare measures and will therefore leave the near-term fiscal gap open. The publication of the Milburn and Timms reviews, expected in November, which will show whether the support the Government promises is funded or aspirational. And the Spending Review, where the numbers Parliament should have seen before it voted will finally be published, alongside the defence settlement that will compete with welfare for the same headroom.
The Government’s case is that early spending buys lower costs later, and it may prove right. But the country is being asked to take that on trust from a government that has not published the arithmetic, has not named the cuts, and will not face the electorate until after the savings are supposed to have begun.
The Department for Work and Pensions said: “The reviews, due in the autumn, will lay the foundation for sustainable reform, and we will not pre-empt their findings. We’re already restoring opportunity for young people through our £2.5bn youth employment package, investing record funding into employment support to help disabled people and those with long-term health conditions and rebalancing the standard and sickness rates of Universal Credit for new claimants.”
Great British PAC reaction
Great British PAC’s assessment is that the Government has set out a destination without a route, a timetable or a fare.
Fiscal transparency. Parliament and taxpayers are entitled to independently scrutinised, year-by-year estimates of what these reforms cost and what they save, published before MPs vote rather than after. A Spending Review is an accounting event for the executive. It is not a substitute for scrutiny of legislation by the legislature.
Work and opportunity. Welfare reform should move people who can work into sustainable employment, and young people should be the first priority. Nearly a million people aged 16 to 24 outside work, education and training is a failure of the state before it is a failure of any individual. A system that assesses what a young person cannot do, pays them, and then leaves them alone is neither compassionate nor affordable.
Protection for vulnerable people. Reform must distinguish honestly between those who can work with the right support and those whose disabilities or health conditions prevent it. Savings achieved by blurring that line would be a false economy and a moral one. Great British PAC will judge these reforms on whether they protect the people who need protection while offering a genuine route back into work for those who do not.
Government accountability. Ministers should publish the financial consequences of major legislation before asking Parliament to approve it. That is not an obstruction to reform. It is the minimum condition of informed consent, and it is the standard the Government applied to every opposition party when it sat on the other side of the House.
Public spending priorities. Welfare commitments cannot be considered in isolation from defence, public services and the burden on working taxpayers. The Chancellor has a defence target he set for himself, a welfare bill rising on every published forecast, and a Budget next week that will address neither. The public is entitled to a Government that sets priorities openly rather than deferring every difficult choice to a review.
Claire Bullivant, Chief Executive Officer of Great British PAC, said:
“Labour appears to have developed a remarkable talent for spending other people’s money today and leaving somebody else to pick up the bill tomorrow.
“We saw the dangers of long-term financial commitments under Blair and Brown’s PFI schemes, which left taxpayers paying for contracts decades after the politicians who signed them had departed. Now we are being asked to trust another Labour government with a welfare reform programme whose reported net savings will not arrive until after the next general election.
“The spending is real. The savings are hypothetical. The bill belongs to the taxpayer.
“Nearly a million young people are outside education, employment or training. That is a national scandal. We need a welfare system that restores opportunity, rewards work and protects those genuinely unable to work. But serious reform requires serious financial discipline, not another expensive promise with the difficult questions postponed.
“Where is the year-by-year costing? Where is the independent scrutiny? What happens if the savings never arrive? And why should Parliament approve legislation before ministers have published the figures?
“Every pound wasted or spent servicing unnecessary debt is a pound that cannot strengthen our Armed Forces, put police on our streets or remain in the pockets of hardworking families.
“Labour cannot keep presenting future savings as though they were money already in the bank. Britain needs reform that delivers measurable results, not financial commitments whose consequences are left for the next Parliament to discover.
“Our children are not Labour’s overdraft facility. Our grandchildren are not its repayment plan. And the British taxpayer should not be expected to sign another blank cheque.
“Publish the figures. Prove the savings Then ask Parliament to vote.”
Great British PAC believes a welfare system must offer genuine opportunity, protect those who cannot work and remain accountable to the taxpayers who fund it. If Labour believes its reforms will deliver long-term savings, ministers should publish the evidence, explain the costs and allow Parliament to scrutinise the figures before voting. Britain needs a welfare policy built on results and responsibility, not promises whose financial consequences are left for another Parliament to discover
