Keir Starmer on ‘high alert’ for resignations After Rachel Reeves Did The Unexpected

The Labour government is teetering on the brink of its first major internal crisis as Chancellor Rachel Reeves prepares to impose what backbenchers are calling “the most brutal welfare cuts since austerity.” The scale of discontent within Labour ranks has reached boiling point, with multiple MPs privately threatening to walk out of today’s spring statement in what could become a defining moment of rebellion against Starmer’s leadership.

At the heart of the turmoil lies a staggering miscalculation that has exposed the government’s economic credibility. While Work and Pensions Secretary Liz Kendall boldly claimed £5 billion in savings from sweeping welfare reforms, the independent Office for Budget Responsibility has delivered a devastating verdict – the actual figure is just £3.4 billion. This £1.6 billion shortfall has sent Treasury officials into panic mode, scrambling to find last-minute savings through even harsher measures that will disproportionately hit society’s most vulnerable.

The revised package now includes a draconian six-year freeze on incapacity benefits for new claimants – lasting until 2030 – alongside previously unannounced reductions to the basic Universal Credit rate that won’t take effect until after the next general election. This cynical timing reveals the political calculation behind what unions are calling “social cruelty by instalment.” Disability rights groups are particularly incensed by plans to make PIP claims near-impossible for those with mental health conditions, while the abolition of work capability assessments will force thousands into inappropriate job-seeking activities.

The backlash from Labour’s own benches has been volcanic. “We didn’t overthrow the Tories to become more callous than them,” one shadow minister told us on condition of anonymity. Veteran backbencher Debbie Abrahams gave voice to the growing revolt, pleading with ministers not to “balance the books on the backs of the sick and disabled.” Her intervention was echoed by Clive Lewis, who delivered a blistering critique of the DWP’s apparent ignorance about how these cuts will push millions of struggling families over the edge into destitution.

What makes this crisis particularly dangerous for Starmer is that the rebellion extends beyond the usual socialist suspects. Moderate MPs in marginal seats are reporting floods of angry correspondence from constituents who see these cuts as a fundamental betrayal of Labour’s values. Union leaders have joined the chorus of disapproval, with Unite’s Sharon Graham warning the government is “in danger of making the wrong choices” at precisely the moment when working people need protection most.

The political fallout could be catastrophic. Today’s spring statement was meant to be a low-key technical exercise, but has instead become a referendum on Labour’s soul. With the OBR’s damning figures exposing the flimsiness of the government’s economic claims, and backbenchers openly threatening mass resignations, Starmer finds himself trapped between his ironclad fiscal rules and the moral expectations of the movement that put him in power. As one senior MP grimly predicted: “This isn’t just about welfare reform – it’s about whether this Labour government remembers why it exists.”