Reeves refuses to apologise for repeating false claim that social security spending is spiralling

Chancellor Rachel Reeves has refused to withdraw a misleading and inaccurate statement that scapegoated disabled people and other benefit claimants for the country’s economic problems.

In an interview with Channel 4 News, Reeves (pictured) repeated the false claim that welfare spending was spiralling out of control.

She told the programme: “We can’t get to the end of this parliamentary session and have done nothing, because if more and more of our money that we spend as a government is spent on welfare, you’ve got less for the NHS, you’ve got less for schools.”

It came as government sources briefed the Times newspaper that Reeves was intending to raise revenue from the Motability disabled people’s vehicle scheme by £1 billion a year in the budget by attacking its VAT and insurance premium tax exemptions (see separate story).

Disability News Service (DNS) told the Treasury this week that Reeves should be aware that her statement on “welfare” was highly misleading.

This is because figures from the Office for Budget Responsibility reported last autumn* that welfare spending was stable as a proportion of GDP, and that it was lower than it was in 2015-16.

DNS shared figures with the Treasury that showed that the share of GDP was predicted to be 11.1 per cent in 2024-25; the same in 2025-26 and 2026-27; to fall to 11.0 per cent in 2027-28 and 2028-29; and to rise to 11.1 per cent again in 2029-30.

The Treasury, Department for Work and Pensions, and political parties, including Labour and the Conservatives, have been repeatedly shown these figures by DNS, and yet senior figures across the parties continue to claim that spending on social security is “spiralling”.

Last week, the Financial Times agreed with months of reports and analysis from DNS, academics and disabled campaigners, and concluded: “Costs are not spiralling.

“Projected total welfare payments, at around 11 per cent of national income a year, are lower than when David Cameron was prime minister even though there are more pensioners.”

Chris Giles, the paper’s economics commentator, added in his article: “The welfare system is far from perfect but it cannot be blamed for your taxes rising in November’s Budget.”

The Treasury this week refused to comment on why Reeves and fellow ministers repeatedly claim that social security spending is spiralling out of control when it is not, and whether she would apologise.

*Chapter five of OBR’s Economic and Fiscal Outlook – October 2024, chart 5.2, shows welfare spending as a percentage of GDP: https://obr.uk/efo/economic-and-fiscal-outlook-october-2024/

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