WATCH: Pat McFadden defends 'compassionate' Keir Starmer amid Labour benefits bill row

GB News

The Chancellor of the Duchy of Lancaster has indicated that tax increases could be necessary after the Government reversed course on disability benefit reforms.Speaking to GB News, Pat McFadden acknowledged the financial impact of abandoning controversial changes to Personal Independence Payment (PIP).FULL STORY HERE.

Transcript

00:00Speak to the government, shall we? And the Chancellor of the Duchy of Lancaster, Pat McFadden.

00:05Good to see you this morning, Mr McFadden. Good morning. Good morning. Let's talk about the welfare

00:11bill, shall we, that limped through the House last night. I mean, it passed, but essentially

00:16Sir Keir Starmer took on his MPs and he lost, didn't he? It's humiliating for him. Has he lost

00:23control of the party? It's been a very difficult process in the last couple of weeks. Very

00:32impassioned debates in the Labour Party about this issue of welfare reform, as there always

00:37are. And where we eventually got to last night was taking forward those elements of universal

00:44credit reform that were in the bill, but taking that very contentious issue of PIP reform and

00:51giving that into a review led by my colleague Stephen Timms, the Disability Minister. He's

00:56an excellent person to do this, a very experienced, deeply compassionate politician, and we'll

01:02have to take that forward in a different way. So how much money are you going to save with

01:08this bill? Have you actually been able to work that out, Pat? There's definitely a financial

01:16consequence to the decision taken yesterday. If you're not saving money from this, it has to come

01:23from somewhere. All of that will have to be taken into the round, along with all the other government

01:29expenditure pressures when we reach a budget later in the year. I'm not going to speculate about that

01:36now, but I do acknowledge there's a financial consequence to the decision reached last night.

01:41And if that financial consequence wasn't the consequence that you want, is there any point

01:47going ahead with this? Yeah, there is, because there are still elements of this which are important

01:55in helping long-term sick and disabled people into work. We are an outlier in terms of the proportion of

02:01people in work today compared to the pre-COVID period when we look at other countries. So there's

02:08something that's gone wrong in the UK and the elements that were passed last night will help to

02:14do something about the, there's almost an incentive at the moment for people to go for the health-related

02:22universal credit element rather than the standard, because the financial gap between them is so big.

02:27There's not enough employment support for people who are on long-term sickness or disability benefits.

02:34We believe with that support more could get into work. So there is a point in going ahead,

02:40but it's been a difficult process. There's no denying that. There's no soft-soaping it.

02:44And with that most contentious element, we now have to take that forward in a different way.

02:50And how is Rachel Reeves going to plug that gap of £5 billion worth in savings, which has now

02:55essentially been lost? Is she going to have to come back with tax rises in the autumn?

02:59Well, I don't want to speculate about the budget. I've acknowledged that the decision taken yesterday

03:06does have a financial consequence. While that is a substantial amount of money, it's in the context

03:13of a much, much bigger government budget that covers all the departments, all the commitments,

03:18not just working pensions. So she will have to take that into consideration in the round,

03:24along with everything else. This is one element, one moving part, if you like, in a budget. But a

03:29budget has a hundred or more moving parts. And what the Chancellor has to do is put them all

03:34together in one package when the time comes. Pat, how would you sum up the relationship now between

03:40backbenchers and the Prime Minister? Is it strained? Is it soured? Is it repairable?

03:46Look, it's been a difficult process, but I believe in being a team. You know, I chaired the election

03:55campaign that concluded almost exactly a year ago. We won that election as a team. The Cabinet

04:02serves together as a team. And even though this has been difficult, it's been fractious at times,

04:07we'll move forward from this as a team as well. It's incredible, though, isn't it? If you think

04:11you're not even a government that's one years old, you're turning one on Saturday. That's your one

04:16year anniversary. But you must be worrying now, realistically, practically, how are you going to

04:21get things passed in the House? I mean, already you've given this message to Labour MPs that any sign

04:29of rebellion or controversy that you will U-turn. You've turned on winter fuel. You've U-turned on the

04:33National Enquiry with grooming gangs. You've now U-turned on this. The Prime Minister himself talking

04:39about islands of strangers and then saying that he regrets that. So you're turning on his own

04:44speeches now. What message are you giving to your party? Look, I think reflection on things is not

04:53a sign of weakness. It's a sign of strength. And there are many nettles being grasped. We have grasped

04:58the netto of planning reform that stopped or slowed down building in this country for years. We're pressing

05:03ahead with new nuclear power stations that have been held up for years. We're starting the turnaround

05:09in the NHS. And today, by the way, we are announcing the biggest expansion in social and affordable

05:15housing for a generation. And all of that's only possible because of the leadership of the Prime

05:21Minister and the Chancellor and the Deputy Prime Minister in putting their shoulder behind the wheel

05:26of those decisions. Yeah. Tell us about these housing plans that you have, because these are very,

05:33very important, Pat. You know, for the country to move forward in terms of, you know, just finding

05:39homes for people in general, finding social homes for the population, which we're very short on.

05:46What are you planning to do that will change things?

05:52Well, in the spending review that took place a few weeks ago, the Chancellor set aside £39 billion

05:58over the coming years to invest in social and affordable housing. And we hope through that to

06:05get 300,000 social and affordable houses. This will make a massive difference to the constituents of

06:14every MP in Parliament. We all have people at our advice surgeries every month, overcrowded,

06:21maybe living with their parents and so on, looking for a council or a housing association flat.

06:27This is a step change in the provision of social and affordable housing. I would say it's one of the

06:33biggest unmet needs in the country. It's very corrosive to people's hopes for their future. So today is a

06:41plan of hope to do something about that in a big, big step change from anything that we've seen for

06:48decades in this area. Well, good luck to you.

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