Chancellor says current welfare system ‘is not working for anyone’ after reports of unease within the Labour cabinet
Good morning. Keir Starmer is likely to spend much of the day preparing for tomorrow’s online summit that he is chairing for European leaders who might be part of the “coalition of the willing” prepared to help contribute to Ukraine’s defence in the event of a peace deal. But Russia’s response to the US/Ukraine ceasefire plan has not been promising, as Jakub Krupa reports on his Europe live blog, where he is covering all today’s developments in this story.
Domestically, it is not much easier for the PM either. This morning we learned that the economy shrank in January. Julia Kollewe is covering all this in detail on the business live blog.
And now we are only a few days away from the publication of the government’s plans to cut sickness and disability benfits by a reported £6bn, which in some respects is an even bigger problem for Starmer because it threatens to blow apart Labour party unity. In a remarkable story for Bloomberg last night, Ailbhe Rea says that at cabinet this week more than half of ministers there urged Rachel Reeves, the chancellor, to rethink these proposals. Rea says:
During the cabinet meeting, ministers voiced their frustration that such difficult welfare cuts are coming so soon after the raid on the aid budget, according to the people. They said how difficult the cuts would be to sell to the Labour parliamentary party.
One person said some ministers are on resignation watch, depending on the shape of the final package. A Labour lawmaker said Anneliese Dodds – who quit as development minister after the aid cut – won’t be the last to leave government as politicians are asked to stomach difficult cuts. A third person noted that Labour was planning a benefit cut that even George Osborne, the architect of the most recent phase of Conservative austerity, didn’t make.
Osborne has been making this very point himself, trolling the chancellor on his Political Currency podast.
But Reeves herself seems in no mood to back down. In an interview on BBC Breakfast this morning, where she was responding to the growth figures, Reeves was asked about the plans for welfare cuts. She replied:
We will set out our plans for welfare reform, but it is absolutely clear that the current system is not working for anyone.
It is not working for people who need support, it’s not working to get people into work so that more people can fulfil their potential, and it’s not working for the taxpayer when the bill for welfare is going up by billions of pounds in the next few years.
So, we do need to get a grip. We need to spend more on national defence, but we need to reform our public services, and we need to reform our broken welfare system.
Here is the agenda for the day.
9.30am: MPs debate private members’ bills, starting with Scott Arthur’s rare cancers bill.
Morning: Rachel Reeves, the chancellor is visiting a defence firm in Fife.
10.35am: Bridget Phillipson, the education secretary, speaks at the Association of School and College Leaders conference.
11.30am: Downing Street holds a lobby briefing.
If you want to contact me, please post a message below the line or message me on social media. I can’t read all the messages BTL, but if you put “Andrew” in a message aimed at me, I am more likely to see it because I search for posts containing that word.
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Prisons in England and Wales are forecast to run out of space again in early 2026 as years of government efforts have failed to create the extra capacity needed, MPs have warned.
A report from the Commons public accounts committee out today says plans from 2021 to create 20,000 more prison places by the mid 2020s were “completely unrealistic” and thousands of outstanding spaces are expected to be delivered five years late for £4.2bn – 80% – more than planned.
The report says:
As a result of poor planning and delays, the adult male prison estate was operating at 98.0% to 99.7% occupancy between October 2022 and August 2024 and remains alarmingly full.
Overcrowding is endemic, staff are overburdened, and access to services and purposeful activity is poor. The current prison system has had to focus on ensuring there are sufficient places to house prisoners. While the efforts of HMPPS [HM Prison and Probation Service] staff to avert disaster are admirable, this state of crisis undermines their efforts to rehabilitate prisoners and reduce reoffending.
It also represents poor value for money for the taxpayer, with MoJ and HMPPS unable to make sufficient progress on maintaining existing cells, and needing to rent police cells due to a lack of capacity.
MoJ [Ministry of Justice] and HMPPS have relied on the early release of prisoners to prevent total gridlock in the criminal justice system. Despite releasing thousands of prisoners early, MoJ still forecasts it will run out of capacity by early 2026.
It is relying on the ongoing independent Sentencing Review to prevent this. However, any decisions to divert more people from prison will likely increase pressures on other parts of the system, particularly the Probation Service, which already has issues with staff shortages and high caseloads.
As PA Media says, the report reveals that one reason why more prison places are not being created as quickly as planned is that MoJ and HMPPS assumed they could gain planning permission for new jails in 26 weeks.
The committee is calling for MoJ and HMPPS to assure parliament their plans are now realistic and how they will manage risks, particularly in relation to planning permission.
It also wants relevant bodies to set out plans to assess the impact of prison capacity pressures on self-harm and violence and access to education, drug rehabilitation and work opportunities, PA says.
Commenting on the findings, Geoffrey Clifton-Brown, the Conservative MP who chairs the committee, said:
Lives are being put at increasing risk by the government’s historic failures to increase capacity.
Despite the recent emergency release of thousands of prisoners, the system still faces total gridlock in a matter of months.
Good morning. Keir Starmer is likely to spend much of the day preparing for tomorrow’s online summit that he is chairing for European leaders who might be part of the “coalition of the willing” prepared to help contribute to Ukraine’s defence in the event of a peace deal. But Russia’s response to the US/Ukraine ceasefire plan has not been promising, as Jakub Krupa reports on his Europe live blog, where he is covering all today’s developments in this story.
Domestically, it is not much easier for the PM either. This morning we learned that the economy shrank in January. Julia Kollewe is covering all this in detail on the business live blog.
And now we are only a few days away from the publication of the government’s plans to cut sickness and disability benfits by a reported £6bn, which in some respects is an even bigger problem for Starmer because it threatens to blow apart Labour party unity. In a remarkable story for Bloomberg last night, Ailbhe Rea says that at cabinet this week more than half of ministers there urged Rachel Reeves, the chancellor, to rethink these proposals. Rea says:
During the cabinet meeting, ministers voiced their frustration that such difficult welfare cuts are coming so soon after the raid on the aid budget, according to the people. They said how difficult the cuts would be to sell to the Labour parliamentary party.
One person said some ministers are on resignation watch, depending on the shape of the final package. A Labour lawmaker said Anneliese Dodds – who quit as development minister after the aid cut – won’t be the last to leave government as politicians are asked to stomach difficult cuts. A third person noted that Labour was planning a benefit cut that even George Osborne, the architect of the most recent phase of Conservative austerity, didn’t make.
Osborne has been making this very point himself, trolling the chancellor on his Political Currency podast.
But Reeves herself seems in no mood to back down. In an interview on BBC Breakfast this morning, where she was responding to the growth figures, Reeves was asked about the plans for welfare cuts. She replied:
We will set out our plans for welfare reform, but it is absolutely clear that the current system is not working for anyone.
It is not working for people who need support, it’s not working to get people into work so that more people can fulfil their potential, and it’s not working for the taxpayer when the bill for welfare is going up by billions of pounds in the next few years.
So, we do need to get a grip. We need to spend more on national defence, but we need to reform our public services, and we need to reform our broken welfare system.
Here is the agenda for the day.
9.30am: MPs debate private members’ bills, starting with Scott Arthur’s rare cancers bill.
Morning: Rachel Reeves, the chancellor is visiting a defence firm in Fife.
10.35am: Bridget Phillipson, the education secretary, speaks at the Association of School and College Leaders conference.
11.30am: Downing Street holds a lobby briefing.
If you want to contact me, please post a message below the line or message me on social media. I can’t read all the messages BTL, but if you put “Andrew” in a message aimed at me, I am more likely to see it because I search for posts containing that word.
If you want to flag something up urgently, it is best to use social media. You can reach me on Bluesky at @andrewsparrowgdn. The Guardian has given up posting from its official accounts on X but individual Guardian journalists are there, I still have my account, and if you message me there at @AndrewSparrow, I will see it and respond if necessary.
I find it very helpful when readers point out mistakes, even minor typos. No error is too small to correct. And I find your questions very interesting too. I can’t promise to reply to them all, but I will try to reply to as many as I can, either BTL or sometimes in the blog.
