Why the Tories won’t be voting for welfare reform

Cutting back the benefit bill – surely that is a Conservative Party goal, if any. Get numbers down and reduce the rapidly ballooning size of the state.

Why is it then, that, later today the Tory party is set to vote against welfare reform that does cut that spending?

For some, with it being a Labour government’s plan, ideologically, it might have been a clear answer – but it was not necessarily an obvious one for the Tory leadership.

The welfare issue dominated the meeting of shadow cabinet last week where, one minister present tells me, there were “genuinely conflicting opinions”, with another adding there was a 60/40 to 70/30 split of voting against versus for today’s reforms.

Shadow Work and Pensions secretary Helen Whately presented the group with pros and cons for both options, before Kemi Badenoch – who purposefully did not take a position – asked those around the table to go round and explain both how and why they thought the party should whip its MPs. “We had a kuumbaya moment,” one of those shadow cabinet minister jokes.

It led to a split between what that shadow cabinet minister calls members “overtly in favour of voting for the welfare reforms” like Kevin Hollinrake, James Cartlidge and Laura Trott, and those who ultimately won out like Mel Stride, Andrew Griffith, Andrew Bowie and Mims Davies. (If anyone was particularly interested about Robert Jenrick’s position, I’m afraid he wasn’t at this meeting of shadow cabinet as he was out on a visit.)

Davies was outspoken in thinking that voting in favour of Labour’s proposals would have been a move that was “far too governmentitis”: a phrase that has often been thrown out to critique LOTO’s political movements.

“I think it would have been mad to support it,” one shadow cabinet minister tells me, “we need to make Labour’s lives as difficult as possible.”

“We need to be opposition. The party needs a win and for the backbenches to feel like we are fighting.”

Another supportive shadow cabinet minister says similarly: “The reforms do not go far enough, but currently they hurt the most vulnerable – and we want to be causing the maximum political pain by either reducing Labour’s majority or helping vote it down.”

The group in favour, I understand, made the case that I set out at the beginning: the Conservative Party agrees there should be welfare reform and that the welfare bill should be cut – these proposals go some way to doing that. “Responsible opposition and consistency,” was their pitch, according to one member of the shadow cabinet. But others, they say, thought at the time: “Are you joking? We need to start opposing.”

These are not the right reforms the welfare system is so desperately in need of – and they are ones for the opposition to, well, oppose. It shouldn’t just be about cutting the benefit burden, but actually fixing a broken system that is slowing the economy and trapping people out of work.

With these reforms, another shadow cabinet minister tells me, “it is the worst of all worlds” – a Treasury raid without a properly considered solution. “There is a need to really work proposals out and really make the case, of which Labour have done neither,” they add.

That is exactly why Keir Starmer is facing the biggest rebellion of his premiership, so far. Several of his senior backbenchers have raised concerns and warned that the government’s plans would lead to a “three-tier” benefits system in which within the welfare system there are existing claimants, new claimants who will lose out following the reforms, and claimants post-Timms review, which will report back in the autumn of next year on the future of personal independence payments (Pip). Even this morning they are still urging the government to reconsider the legislation.

The thing is, these proposals not only fail to set out true reform, but the savings are now ever shrinking with every change made in attempts to quell the rebellion. Original predicted savings of £4.8bn were slashed to between £2.2bn and £1.6bn with government concessions.

And it is yet another reason the Tories see to avoid walking through the voting lobby with Starmer, as one of the earlier shadow cabinet ministers pointed out when it comes to long-term credibility: “We are years away from an election and we won’t win any support for what we did four years out in backing a poor series of a Labour government’s welfare reforms.”

I understand that as part of Badenoch’s policy renewal programme the shadow DWP team already have a series of three changes they would look to make. The first is in bringing back face-to-face interviews so that your first assessment is either at an assessment centre or at home, instead of over the phone. Lockdown in the pandemic saw numbers flip from around 70 per cent of interviews being in-person, to now most being over the phone – and there are reports of online guides on how to game the process.

Sick notes are another part of the system crying out for reform, and as a minister the shadow DWP secretary actually co-commissioned some research on Fit Note Reform that made clear how the policy was going wrong. Take this chunk of the final evaluation:

“Among patients there was also a belief that fit notes are open to potential misuse and people can ‘hide behind them’ to get time off work. When asked if it was easy or hard to get a fit note issued inappropriately, virtually all felt it was easy.”

“The problem is the system is so open to abuse,” one Tory source tells me, pointing to Dr Sick Ltd, a business run by a suspended doctor who has been charging as little as £29 fir same-day sick notes.

The third is when it comes to mental health and the rise in claims for common problems like anxiety or mild depression, coupled alongside behavioural conditions like ADHD which now make up around half of new claims. There is a lack of sympathy, but one that is clearly rooted in a need to boost employment figures, which the same Tory source makes clear helps those people in the long run: “You have got to accept that if you can work, you’ve got to be doing something. Employment is a good intervention for these problems.” Whately has publicly pointed to research by the Centre for Social Justice on the savings that would come from restricting benefits for mild health conditions.

Figures released by the DWP earlier this year make it even more stark. In a survey of 3,401 recipients of health and disability related benefits, 49 per cent claimed they would never be able to work again, with only 5 per cent saying they could work now with the right support. Only about a third of those surveyed with mental health and cognitive/neurodevelopmental reasons said they could do jobs that involved speaking to members of the public – and this group in particular, those not wanting to engage with the public, were disproportionately young. “You want to work with animals? Yes, so did I when I was 12,” one shadow cabinet minister says, “but if you’ve got various factors that physically inhibit that, or you don’t have the qualifications to do that, maybe you just have to look elsewhere”.

Multiple shadow cabinet ministers and whips admitted to trying to keep their cards close to their chest over how the party would vote on the issue until last night as Labour rebels descended once more into fury, realising they had been sold a pup compared to what they wanted. Not that this should come as a surprise, after all Starmer told Labour members in his bid to become leader that he would “scrap Universal Credit and end the Tories’ cruel sanctions”.

Badenoch herself had set three tests as to what could win over Tory support for Labour’s welfare plan: cut spending, boost employment or rule out tax rises. It was pretty obvious they hadn’t been met – and as one shadow cabinet minister put plainly, “she had admitted it was a bad bill!”. But making an effort to play it until the last minute and setting out her challenges could be the start to Badenoch revealing some political chops.

Even one of her more critical MPs admitted: “I think we have actually ended up in a sensible place.” So far that is high praise for the Tory leader, and a personal win that many in her shadow cabinet clearly think her benches were in need of, even if welfare reforms manage to sneak over the line.