Prime Minister Keir Starmer defends budget and vows to reshape UK welfare spending amid political pressure.
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| Prime minister Sir Keir Starmer leaves 10 Downing Street in London to attend Prime Minister’s Questions and the budget session at the House of Commons on November 26, 2025. Photo by James Manning/PA/Getty Images |
Prime Minister Keir Starmer is preparing to launch a renewed campaign to rein in UK welfare spending, positioning the issue as a central pillar of his economic strategy as he attempts to revive a faltering premiership and restore confidence in his leadership. The push to reform UK welfare spending comes as Labour faces persistent criticism over its recent budget and continues to slide behind Nigel Farage’s Reform UK in national polling. Starmer’s upcoming speech, scheduled for Monday, aims to explain the rationale behind the government’s decisions, defend the fiscal direction set by Chancellor Rachel Reeves, and outline how he intends to reshape the future of the welfare system.
At the heart of Starmer’s messaging is the argument that UK welfare spending has grown to unsustainable levels and now requires a set of structural reforms to ensure long-term economic stability. Excerpts released by 10 Downing Street suggest that Starmer plans to frame the budget as a necessary programme for easing cost-of-living pressures while guaranteeing the resilience of public finances in a period of weakened economic sentiment. The commitment to overhaul UK welfare spending is also meant to reassure voters who have questioned Labour’s economic strategy since the introduction of Reeves’ £26 billion tax-raising package.
Reeves’ budget has triggered a difficult political moment for Labour. Critics argue that the fiscal plan contradicts the party’s election promises by raising taxes on working people through the continued freeze on income tax thresholds, while simultaneously increasing several categories of welfare expenditure. The tension between pledges made during the campaign and the realities of governing has been amplified by widespread public dissatisfaction. Data from a YouGov snap poll found that the budget received the second-worst public reaction of any fiscal statement since the company began monitoring responses in 2010.
The perception that Labour’s fiscal choices favour welfare increases at the expense of taxpayers has created a potent line of attack for the Conservative Party, which denounced the package as a budget for “benefits street.” Meanwhile, Reform UK has seized the moment to portray Starmer as incapable of decisive leadership on UK welfare spending, accusing Reeves of intentionally misrepresenting the state of public finances in the lead-up to the budget. The accusations have deepened public distrust and contributed to Labour’s sliding polling numbers, raising fresh doubts about the stability of the Starmer administration.
The Office for Budget Responsibility (OBR), in its post-budget analysis, reported that total UK welfare spending for this fiscal year is projected to hit £333 billion, or 10.9 percent of GDP, and rise to £406 billion by 2030, or 11.2 percent of GDP. The increase is driven by several decisions taken within the budget, including the £3.1 billion move to scrap the two-child benefits cap, as well as £5.7 billion to reverse earlier proposals to reduce winter fuel payments for pensioners and to scale back disability benefits.
These increases highlight the structural challenge confronting the government. UK welfare spending continues to expand across multiple categories despite sluggish economic growth, placing pressure on public finances and prompting analysts to question the government’s long-term fiscal trajectory. Starmer’s new push suggests recognition that UK welfare spending must now be brought under control to avoid further fiscal deterioration. Yet the political risks remain substantial, given Labour’s internal divisions and the sensitivity of any welfare reform.
Earlier attempts by Starmer to propose reductions in UK welfare spending failed after Labour backbenchers mounted strong resistance, forcing the prime minister to retreat from several planned cuts. The political fallout from that episode contributed to the shortfall in public finances and ultimately made Reeves’ tax increases more politically painful. As Starmer prepares to renew his push for welfare reform, party unity remains a critical challenge. Any perceived attack on social protections risks reigniting tensions within Labour’s parliamentary ranks, especially among MPs who believe the welfare state remains an essential buffer for struggling families.
Downing Street has not yet released detailed proposals for how UK welfare spending will be reshaped. However, Starmer is expected to argue that reforms are necessary to ensure that welfare policies incentivise employment and promote upward mobility rather than dependency. In the excerpts provided, he plans to say that the welfare system is “trapping people not just in poverty, but out of work” and that the government must now remove disincentives that limit economic participation. The framing suggests Labour may pursue a combination of stricter eligibility requirements, expanded employment programmes, and adjustments to benefits designed to support workforce re-entry.
Chancellor Rachel Reeves has faced her own set of political accusations in the aftermath of the budget. Reform UK leader Nigel Farage has called for a formal investigation into whether Reeves misled voters in her pre-budget remarks, accusing her of downplaying the severity of the fiscal outlook in the months leading up to the November 26 announcement. In a letter to the government’s independent adviser on ministerial standards, Farage argued that Parliament “was not given the full and truthful picture when it mattered most,” and claimed that Reeves’ subsequent defence of her approach proves that the messaging was intentional.
Reeves strongly denied the allegations in a series of televised interviews on Sunday, arguing that the OBR’s updated forecasts show a clear deterioration in public finances since March, which necessitated the tax increases and welfare adjustments contained in the budget. She insisted that the changes were essential to maintain compliance with her fiscal rules and to build a sufficient buffer for future economic uncertainty. Her defence underscores the delicate balancing act Labour must perform as it navigates both public frustration and scrutiny from political rivals who sense an opportunity to undermine the government’s credibility.
Starmer seeks to reset his leadership through economic reform
Starmer’s renewed focus on UK welfare spending represents an attempt to reset his leadership narrative by positioning himself as a responsible steward of the nation’s finances. The prime minister hopes that presenting a clear and decisive plan on welfare, economic regulation, and fiscal discipline will help restore voter confidence and stabilise his administration. In addition to addressing UK welfare spending, his upcoming speech is expected to outline a push to remove regulatory barriers that businesses argue have increased costs and hindered growth.
This element of the speech also appears to be a strategic response to concerns raised by business leaders after the government reconsidered its employment rights bill last week, following warnings that the proposal risked stifling job creation. By emphasising deregulation and economic competitiveness, Starmer aims to reinforce Labour’s commitment to pro-growth policies at a time when the public remains wary of increased taxes and rising living costs.
Although Starmer’s pledge to address UK welfare spending may provide a temporary political narrative, its long-term viability remains uncertain. The government must balance fiscal discipline with the risk of alienating voters who rely on the benefits system for stability. Additionally, any reduction in welfare spending must be weighed against social and economic consequences, particularly in regions where employment opportunities are limited. Without presenting specific measures, the government’s intentions remain subject to speculation, and both supporters and critics await concrete proposals to evaluate the real impact.
For now, Starmer’s speech marks an effort to regain control of a difficult political moment. His success will depend on whether he can persuade voters that tackling UK welfare spending is essential for the nation’s future, and whether his party can maintain unity during what is likely to be a contentious policy debate. As the political and economic challenges continue to deepen, the government’s approach to UK welfare spending will remain a defining test of Starmer’s leadership in the months ahead.
