Labour plans to cut benefits bill by reducing NHS backlog

Shadow chancellor Rachel Reeves speaking about the economy at the Association of British Insurers in the City of London on Tuesday. Jordan Pettitt/PA Wire

A Labour government would not be able to spend more money on benefits but would rely on clearing the NHS backlog to get more people into work, Rachel Reeves has said.

Rishi Sunak has promised to overhaul welfare for the unemployed and disabled people, to encourage them to work as much as they can and withdraw cash handouts from those who are deemed not to need them.

Labour has not yet revealed full details of its alternative benefits plan but is set to reject calls from charities and campaigners to make the system more generous overall.

Asked by i whether she would put more money into welfare, the shadow Chancellor said: “I’m not going to be making any unfunded spending commitments.”

Speaking during a Q&A following a speech in London, Ms Reeves added: “If people can work they should be in work, and there’s a clue in the name – the Labour party is the party of work and think that work is good for people’s mental and physical health as well as contributing to a strong, secure economy.

“But the Government needs to do more to ensure that people who are able to work and when you’ve got a backlog of more than 7 million on NHS waiting lists it’s hardly surprising that some people are not able to work today.

“And that’s why we’ve said that we would have a crackdown on tax avoidance and also ensure that non-doms pay their fair share of tax in Britain, and put that money into 2 million additional appointments a year in our NHS to clear that backlog.”

The shadow Chancellor also suggested that she would raise the thresholds for paying the basic and higher rates of income tax, which have been frozen since 2021 and are not due to change until 2028.

Ms Reeves said: “I’ve made no bones about wanting taxes on working people to be lower. The tax burden is the highest it’s been in 70 years and it’s due to go up in each of the next five years.

“But I’m not willing to do what Rishi Sunak and Liz Truss and a litany of Conservative ministers and MPs are willing to do, which is to make unfunded commitments, because that is the way to economic ruin. So when resources allow, I would like taxes on working people to be lower, but I’m not going to make any unfunded tax cuts or spending commitments.”