At noon, Prime Minister Keir Starmer will face off with Conservative Party leader Kemi Badenoch in the Commons, for the first time since his extensive welfare reforms were unveiled.
Wednesday 19 March 2025 10:38, UK
Unreliable data in government accounts has resulted in income and debt being overstated by tens of billions of pounds while undermining transparency and financial oversight, it has emerged.
A report on the whole of government accounts (WGA) 2022-23 warns that gaps in detail and delayed independent financial assessments mean the government cannot effectively monitor the health of councils’ balance sheets at a time of repeated warnings that more may be forced to declare effective bankruptcy.
As a result of the backlog, the National Audit Office has been unable to sign off the government accounts for 2022-23, with just 10% of the 426 local authorities in England submitting reliable data for that year.
This has prompted the Public Accounts Committee to raise concern that the Ministry of Housing, Communities and Local Government (MHCLG) is not able to track the state of finances across local government and intervene where necessary.
The lack of transparency on councils’ outlook comes at a time when they face rising populations, growing demand for support services and lower incomes, the committee said.
The report found the impact of missing data is estimated at net income in the WGA, a consolidated set of financial statements for the UK public sector, being overstated by £34.4bn – while net debt was overstated by £31.7bn.
The government told the committee that it is aware of what is happening at councils across the country and, despite the unreliable data, there are other ways to check the health of local government finances.
These were cited as informal conversations, other forms of data, and auditors’ duty to issue reports on significant issues in the public interest.
👉Listen to Politics at Sam and Anne’s on your podcast app👈
Sky News’ Sam Coates and Politico’s Anne McElvoy present their guide to the day ahead in British politics.
Keir Starmer’s team spend the day trying to work out how the Trump-Putin phone call really went down. Could the UK end up sending more military support to Ukraine before any pause in fighting?
The idea of an ice hockey game apparently came up on the call – Anne has an important history lesson on that.
Around Westminster, it’s PMQs but the Labour charm offensive to convince its backbenchers of its welfare reforms goes on.
By Becky Johnson, social affairs correspondent
On a hilltop above Ashfield, a sculpture of a miner watches over the local towns.
In a part of Nottinghamshire with a proud mining heritage, almost a third of working-age people are now economically inactive.
It’s places like this where they’re bracing for the impact of welfare reform.
A group of young people meet here in a local park, before the government unveiled its benefit crackdown designed to save £5bn. They’re among the UK’s almost a million so-called NEETS – people aged 16-24 not in employment, education or training.
Holly, 17, had to drop out of college for having too much time off and explained she has a long-term condition that makes her sick, as well as autism and ADHD.
“I’m still living with my parents but I’m also on PIP,” she says.
She’s concerned that the government is tightening eligibility for PIP – personal independence payments – as part of cuts to sickness and disability benefits.
A minister has said the latest developments on Ukraine are “not encouraging”.
Continuing his morning media round, Stephen Timms said he welcomed the “rather limited” commitment that Russia made to stop targeting energy infrastructure.
The minister told LBC: “What we need is the full ceasefire that the US and Ukraine have agreed to.
“The prime minister spoke to President Zelenskyy last night. We want to see the ceasefire.”
Asked how realistic a prospect that is, he said: “It’s not encouraging beyond this rather limited move that Russia has made.
“Let’s hope that Russia can be prevailed on to deliver the full ceasefire that the US and Ukraine are asking for.”
In the wake of a wide-ranging package of reforms on benefits, Labour has claimed that it did not mislead voters ahead of the general election.
Stephen Timms, the work and pensions minister, told Sky News that Labour had outlined how it “wanted to bring forward a plan to fix a broken system” in the document, which details potential policy.
The party is facing accusations that it “rushed” through these welfare reforms in a bid to plug a “black hole” in public finances, but Work and Pensions Secretary Liz Kendall has insisted this is not the case.
Here, Sky News details exactly what Labour did say about welfare in its manifesto.
‘Too many people are out of work’
The document detailed how “long waits for treatment of health conditions, particularly mental health, are contributing to the rise in economic inactivity”.
Labour pledged to “reform employment support so it drives growth and opportunity”.
National jobs and careers service
One major pledge in this realm was merging Jobcentre Plus and the National Careers Service to provide a national jobs and careers service.
The Department for Work and Pensions set out plans for this in the early days of the Labour government.
Tackle the backlog of access to work claims
Additionally, Labour said in its manifesto that it would “tackle the backlog of access to work claims and give disabled people the confidence to start working without the fear of an immediate benefit reassessment if it does not work out”.
The manifesto said the work capability assessment is “not working” and “needs to be reformed or replaced”.
Kendall confirmed on Tuesday that work capability assessments will be entirely scrapped in 2028.
Labour also mentioned a “proper plan to support disabled people to work” in its manifesto.
As a reminder, this is what Labour announced on welfare:
Mel Stride, the shadow chancellor, this morning claimed that Labour’s welfare reforms have been “rushed”.
Speaking to Sky News Breakfast, the Conservative frontbencher was asked if he will support the wide-ranging reforms, which were announced on Tuesday.
He told Wilfred Frost: “We’re going to have to look more closely at the details on that. Although let’s be clear, this has been rushed.
“There was no mention even in the Labour Party manifesto, for example, about changes to the payment benefit.
“Labour has voted shy on welfare because it’s deeply divisive within their own ranks.”
Not ‘good policy’
Stride claimed this decision was made “late in the day” because Chancellor Rachel Reeves “killed the economy standard with a budget last October”.
She “now needs to find some money for our emergency budget next Wednesday”, he said (referring to the spring statement).
“That’s what’s going on here, and I’m afraid that doesn’t make for good policy, particularly in the area of welfare where you do need to take your time and to be thoughtful about it.”
👉Listen to Politics at Sam and Anne’s on your podcast app👈
Sky News’ Sam Coates and Politico’s Anne McElvoy present their guide to the day ahead in British politics.
Keir Starmer’s team spend the day trying to work out how the Trump-Putin phone call really went down. Could the UK end up sending more military support to Ukraine before any pause in fighting?
The idea of an ice hockey game apparently came up on the call – Anne has an important history lesson on that.
Around Westminster, it’s PMQs but the Labour charm offensive to convince its backbenchers of its welfare reforms goes on.
The Labour government has unveiled a raft of plans for changes to the UK’s welfare system, which it says will save the UK a total of £5bn.
Work and Pensions Secretary Liz Kendall detailed the government’s planned reforms to the welfare and benefits system in the House of Commons.
She made clear Labour’s motivation, pointing to the sheer cost of long-term sickness and disability benefits for working-age people, which has risen by £20bn since the pandemic and is forecast to hit £70bn over the next five years.
Below, our political reporters Faith Ridler and Alexandra Rogers look at all the changes Labour plan to make to the welfare system.
Stephen Timms, the work and pensions minister, is now joining Wilfred Frost on Sky News Breakfast to discuss yesterday’s welfare reforms.
He was asked whether the UK’s economic situation forced these changes, which will save the government around £5bn per year.
“I think the changes needed to be made anyway,” Timms says.
He says £12bn was spent on personal independence payments a year before the pandemic – it’s now up to £22bn and will reach more than £30bn over the next five years “if something wasn’t done”.
“I think whatever the fiscal situation, we would have had to make these changes,” he says.
‘A broken system’
If that’s the case, why weren’t these welfare reforms in Labour’s election manifesto?
Timms says: “We did say in the manifesto that we wanted to bring forward a plan to fix a broken system.”
He insists the changes Labour are making “are the right changes”.
“The previous government made lots of changes which did a great deal of damage,” he says.
Our political editor Beth Rigby previously asked Work and Pensions Secretary Liz Kendall if the welfare reforms were simply a way to plug a “black hole” in public finances.
Kendall also claimed she would be reforming the welfare system “whatever the fiscal position”.
The rising sickness and disability benefits bill is “devastating” for the public finances and has “wreaked a terrible human cost”, Sir Keir Starmer has said.
The prime minister was writing in The Times shortly after his government announced a £5bn cut to welfare.
With their raft of reforms, the government hope to bring more working age people back into jobs – and save the taxpayer billions of pounds.
Moves include tightening the eligibility for personal independence payments (PIP), a benefit aimed at helping those with disability or long-term illness with increased living costs.
‘Indefensible’
Starmer said the 2.8 million working age people out of work due to long-term sickness is a “damning indictment of the Conservative record” on welfare.
He added: “The result is devastating for the public finances. By 2030 we are projected to spend £70bn a year on working-age incapacity and disability benefits alone.
“But more importantly it has wreaked a terrible human cost. Young people shut out of the labour market at a formative age. People with complex long-term conditions, written off by a single assessment.
“People who want to return to work, yet can’t access the support they need. All this is happening at scale, and it is indefensible.”
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