UK chancellor pledges welfare bill reduction and outlines budget measures
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Chancellor John Healey said the benefits bill will be cut before the next election and announced energy-cost relief, while the Office for Budget Responsibility warned welfare spending could rise sharply.
Chancellor John Healey told BBC Radio 4’s Today programme that the government will reduce the overall welfare bill before the next election, describing the current system as “unsustainable”. He said the reduction will be achieved “in a Labour way” and will rely on young people taking up job and training offers, following recommendations from the Milburn review of youth and work and the Timms review of disability benefits.
In the budget presented on Wednesday, the Treasury announced measures to ease household costs, including a £100 discount on energy bills for up to 20 million households in council tax bands A to D and the removal of standing charges on gas. Healey said these steps were funded by higher taxes on banks and landlords.
The Office for Budget Responsibility projected total welfare spending to rise from £334 billion last year to £431 billion by 2030, with roughly half of the increase allocated to pensions and a quarter to sickness and disability benefits.
“We have to bring the benefits bill down,” Healey said on BBC Radio 4. “There will be a reduction in the benefits bill. We’ll do that in a Labour way and we will do that because it is simply not good for Britain or progress to have a bigger and bigger benefits bill,” he added.
The Resolution Foundation, an economic think-tank, criticized the budget as insufficient to meet the country’s challenges. Chief executive Ruth Curtice said the support for households was “spread far too thinly” and warned that typical annual energy bills could still exceed £1,700 after the government’s assistance.
Healey also commented on international issues, stating that peace in the Middle East and Ukraine would be the most beneficial outcome for UK economic policy. He noted that President Trump could play a role in bringing conflicting parties together and said the British government was working toward reopening the Strait of Hormuz and ending the Russian invasion of Ukraine.