Labour rebellion over benefit cuts
by Daphne Liddle Forty backbench Labour MPs on November 3 voted against Social Security Secretary Alistair Darling's Bill to means-test the Incapacity Benefit paid to disabled people. The Bill passed nevertheless because Labour has such a huge majority. The Labour leadership had expected a revolt and curiously even welcomed it. One of the inner circle is reported to have said that it suited the Government to have a revolt because: "It would show we had the bottle, that we would do what the Tories failed to do — reform the welfare state." The Tories themselves recently accused the Government of lacking originality and merely picking up policies they themselves had "left on the cutting room floor". The idea of making the Incapacity Benefit means-tested had been introduced by Michael Portillo in 1993 under the Tory regime. The new Bill would have started to cut Incapacity Benefits paid to those with occupational pensions above L50 a week, but Alistair Darling made two concessions that he hoped would take the wind out of the rebellion. He raised the pension threshold to L85 a week (about one fifth of the value of the average male wage) and extended eligibility of new claimants from anyone disabled who had made a National Insurance payment within the last two years to anyone who had made a payment in the last three years. The Disability Benefits Consortium responded: "The compromises are minimal. There is a huge gap between these and the real needs of disabled people." Alistair Darling, in his Commons speech, painted a picture of Incapacity Benefit claimants enjoying private pensions of around L400 a week. Prime Minister Tony Blair claimed that making the Benefit means-tested would allow the government to give more "to those who really need it" — as if most did not. His remarks revealed yet another instance of the Government trying to get the poor to fund benefits to the even poorer. Professor Peter Townsend, speaking for the Disability Alliance, said: "The growth of poverty and structural inequality, which has become a marked feature of Britain in the last two decades, is not going to be stopped by getting the near-poor to pay for the poor, by reducing many benefits relative to earnings and by trying to offset public alarm by increasing the level of benefits only for a select few. "Means-testing benefits, and forcing people into making private arrangements, are both costly to administer and miss millions who are theoretically to be included."
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