Burnham says he wants to cut welfare bill ‘as soon as we possibly can’

Government faces pressure to set out welfare savings plan

Ninoda.com – Andy Burnham has said the government intends to bring down welfare spending as quickly as it can, while declining to promise that the overall bill will be lower before the next general election.

The issue has moved to the centre of the political debate after Budget forecasts projected welfare expenditure rising from £353bn this year to £431bn by 2031/32. Ministers say their approach will focus on helping people move into lasting work rather than making rapid reductions that could push vulnerable people into hardship.

The next election must take place by August 2029. However, Downing Street has made clear that it is not committing itself to a fixed deadline or a numerical target for cutting the benefits bill.

Focus on employment rather than immediate cuts

During a visit to Derby, Burnham said the government wanted to act without delay in supporting people who can move from benefits into jobs. He identified an upcoming report on young people outside education, employment and training as an important next step.

“We want to get the welfare bill down as quickly as possible, and we’re working flat out to that end.”

Burnham argued that reducing expenditure requires more than simply tightening access to support. His position is that people need routes into stable employment, rather than short-term measures that may transfer costs to other public services.

“If we just went and made crude cuts, in the end, that leaves people in crisis, and you spend more public money somewhere else, so it’s about getting people into sustainable employment.”

The comments followed uncertainty over remarks made by Chancellor John Healey. Asked whether the benefits bill would be reduced before polling day, Healey said there would be a reduction and that it would be achieved “in a Labour way”. Treasury figures later objected to treating those comments as a pledge tied specifically to the next election.

The prime minister’s spokesperson subsequently said the government was not creating an arbitrary timetable. Ministers also would not clarify whether success would mean spending falling below today’s total or merely increasing less quickly than current forecasts anticipate. That distinction matters: a slowing in the rate of growth would still leave annual welfare spending above its present level.

Forecasts show where spending is concentrated

The Office for Budget Responsibility expects spending to climb by £19bn this year, reaching £353bn. By 2031/32, its forecast puts the total at £431bn, with health-related payments and support for pensioners accounting for much of the rise.

Of the projected £431bn figure, £209.8bn is expected to go to pensioners, including the state pension and winter fuel payments. Universal credit and older equivalent schemes are forecast to account for £110.7bn, while disability benefits, including personal independence payments, are expected to total £69.6bn.

These figures underline the scale of the challenge facing ministers. Welfare spending covers very different forms of assistance, from pensions earned over a working life to help for disabled people, households on low incomes and people unable to work because of ill health. Cutting one element does not necessarily address the drivers behind another.

The government has already said it will reform the state pension triple lock from 2030. Further policy detail is expected after two reviews due in November.

Reports expected to shape the next stage

One review is examining disability benefits and is co-chaired by Labour minister Sir Stephen Timms. A separate study, led by former minister Alan Milburn, is looking at young people classified as Neet — not in education, employment or training.

Burnham said the Milburn report would be a major priority once published. The government sees helping young people into education, training or employment as part of a longer-term strategy to reduce reliance on benefits.

“We just want to get stuck into supporting people to help people off benefits and into work. There’s no delay there. We want that to happen as quickly as possible.”

The reviews follow a difficult period for Labour’s welfare policy. In June 2025, proposals brought forward by former Prime Minister Sir Keir Starmer — including restrictions on eligibility for certain health-related benefits — triggered a large Labour backbench rebellion. The government subsequently retreated from those plans.

That episode has left ministers trying to show they can restrain the growth of welfare spending while avoiding another confrontation with their own MPs and protecting people who depend on support.

Political and economic pressure grows

Former Bank of England chief economist Andy Haldane said a credible plan demonstrating greater control over benefit expenditure could be welcomed by financial markets. Haldane, who has previously advised Burnham, said the political and economic reward for delivering such a plan could be substantial.

“If the government could get that through I think it would come with a huge bonus.”

The Conservatives have attacked the government’s record, with party leader Kemi Badenoch describing the country as “overspent, overborrowed, overtaxed, and drowning in an out-of-control welfare system”. She also criticised the conflicting signals over whether the bill would fall before the election.

“Don’t let anyone tell you this was a ‘do no harm budget’. In doing so little, Labour have harmed our economic security and they’ve harmed our national security.”

For the government, the immediate task is to turn broad commitments into policies with measurable effects. The November reviews may provide a clearer indication of whether ministers plan to target eligibility rules, employment support, prevention of ill health, help for young people, or a combination of those measures. Until then, the central question remains unresolved: whether ministers can curb the projected rise in welfare spending while delivering the employment outcomes they say are essential.