Welfare Spending

Rachel Gilmour Excerpts

Tuesday 15th July 2025 Commons Chamber

[Dr Mullan]

It is the inability to have difficult conversations and make difficult points that puts Labour Members on the wrong side of these issues and on the wrong side of British taxpayers, who understand the complexity of these things.

[Rachel Gilmour (Tiverton and Minehead) (LD)]

Will the hon. Gentleman give way?

[Dr Mullan]

Not right now.

I recognise, of course, that some people are not able to make the same choice about the number of children in their family—including, for example, children who are cared for under kinship arrangements, or adopted; there are many exceptions to the policy to make it fair. The welfare system is already growing unsustainably, with spending on health and disability benefits alone set to hit £100 billion by the end of the decade, yet Labour, Reform and the Liberal Democrats all back higher welfare spending, including scrapping the two-child limit, which will keep taxes high. The Resolution Foundation estimates that scrapping the two-child benefit limit will cost £3.5 billion a year by 2029-30. Is this really an appropriate time to put more pressure on the public finances?

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[Dr Mullan]

I think we need to look at the absolute poverty figures and at what difference we can make to them—and what makes a long-term difference to the number of people in poverty of any kind is employment. We reversed the decline in employment, but we are now seeing it get higher every day under this Government’s policies. That is what is bringing even more people into poverty—their record on the economy and on employment.

[Rachel Gilmour]

Will the hon. Gentleman give way?

[Dr Mullan]

I want to finish my speech.

Poverty is, of course, a matter for Government. It is about policies and about incomes, but there is another important side to child poverty in this country that people are too uncomfortable to talk about: child maintenance and the absence of payments made in single-parent families. Research by the single-parent advocacy organisation Gingerbread found that 43% of children in single-parent families in the UK are living in poverty, compared with 26% in couple families. We know that poverty has many causes and there is no single solution, but there is clear evidence that when child maintenance is paid in full, it has a significant impact in lifting children out of poverty. Research shows that where it is received, child maintenance cuts the child poverty rate by 25%.

Gingerbread’s “Fix the CMS” report found that 57% of parents who care for a child and had a child maintenance arrangement in place reported that they did not receive the full amount. The amounts involved are significant. At the end of September 2024, total cumulative arrears of payments that were formally expected stood at £682.1 million, and that figure is due to reach £1 billion by the end of the decade. That is just a fraction of the story, because those figures are based only on the sometimes quite pitiful amounts that non-custodial parents have to pay, either because they earn little or because they hide what they earn. Those figures also do not include parents who are not pursued for money by the custodial parent.

Absent parents are denying children much higher amounts of money than the official figures suggest, and there is a deep unfairness to that. If a custodial parent simply chose not to provide any more resources to the child they care for, they would face criminal sanction for neglect. A non-custodial parent who does not give money for the upkeep of their child faces no similar ramifications. I have no idea why we do not place an expectation on a non-custodial parent to make the same efforts to find work and earn money as we do with out-of-work people on benefits, as they are also creating a burden on the taxpayer.

As the Minister may know, there is legislation that allows steps to be taken to place non-paying parents in home detention. I urge her and the Government to look closely at that. If people cannot be bothered to go out, work and pay for their children when they do not live with them, they should not be allowed out on a Saturday night to drink beers with their mates. That would help to drive down the huge amount of money that is owed to children by parents who are simply not paying for them—

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[Sir Ashley Fox]

I am grateful to my right hon. Friend for making that point. I know that he, like all Conservatives, believes in personal responsibility, living within our means and fairness to the taxpayer.

[Rachel Gilmour]

Will the hon. Gentleman give way?

[Sir Ashley Fox]

I will not take any more interventions.

Many thousands of couples think every year about whether to have children. They make that choice based on several factors, but one of the most important is whether they can afford to bring up that child as they would like to. Under the previous system, pre-2017, there was a fundamental element of unfairness in the system. A family in receipt of benefits saw those increase automatically every time they had another child. That is not true for a family not in receipt of benefits. Why is it that someone on benefits should not have to make the same choices and sacrifices as someone in work? Why should a taxpayer who is unable to afford to have more children subsidise the third, fourth or fifth child of someone not in work?

The welfare bill in this country is increasing at an unsustainable rate. Unemployment is rising, thanks to the action of the Government, and more people than ever are receiving disability benefits, but this Government seem completely powerless to do anything to reverse that trend. The Prime Minister says that his welfare reforms strike the “right balance”, but the truth is that he was forced into a humiliating U-turn by his own Back Benchers and has had to totally gut his plans. Scrapping the Government’s PIP reforms means that the welfare Bill will make no savings at all—indeed, the total package will end up costing the taxpayer about an extra £100 million a year. What a fiasco!

The Government set out to save £4.5 billion, and have ended up spending more taxpayers’ money to buy off Labour rebels. No thought was given to the burden on the taxpayer, or to the extra debt that the Government would incur and the interest that will have to be paid on it by our children. The fact that so many Labour Members want to remove the two-child benefit cap is testament to the irresponsibility with which they treat the public finances. Their solution is always to spend more money—preferably belonging to someone else.

Now, we have the spectacle of the leader of Reform UK, the hon. Member for Clacton (Nigel Farage), saying that he also supports scrapping the two-child cap, despite having been an outspoken supporter of it when it was introduced. Reform supporters in my constituency are rather puzzled by his decision. It suggests that the hon. Member is not guided by any political principle, but is chasing votes in the red wall, where he hopes to win seats from the Labour party. In my view, that confirms that he is wholly unserious about governing this country. There is only one party in this House that is serious about sound money, and that is the Conservative party. We are the only party that is serious about stopping the creeping reliance on welfare, and that cares about taxpayers keeping more of the money they earn.

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[Blake Stephenson (Mid Bedfordshire) (Con)]

We must have a fair welfare system—one that provides vital support to those who need it but does not create a barrier to finding work. We need a financially sustainable system that delivers fairness for the taxpayer and does not entrench dependency. The Government’s Universal Credit and Personal Independence Payment Bill—which I think has now been shortened to the Universal Credit Bill—barely saves any money. In fact, I think we heard from the shadow Secretary of State, my hon. Friend the Member for Faversham and Mid Kent (Helen Whately), that it will cost more money, and it will make no impact on helping people back to work. That highlights the Government’s complete failure to reform our welfare system.

The welfare bill continues to rise, and economic growth is being strangled as a result. With thousands signing on to incapacity benefit every day, it is clear that we must get serious and take control of welfare spending. We cannot become a welfare state with an economy attached. I will always stand up for those in Mid Bedfordshire who need vital support. The two-child limit is an important safeguard in our welfare system, striking a balance between supporting families and helping parents into work, and ensuring fairness for working families who do not see their incomes grow as their families grow. Working families across the country are having to make difficult decisions about the size of their family.

[Rachel Gilmour]

Will the hon. Member give way?

[Blake Stephenson]

I will happily give way—the hon. Lady has been trying for some time.

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[Rachel Gilmour]

Does the hon. Member accept that even with his emphasis on parental financial responsibility, the two-child benefit cap punishes the entirely innocent party—the children, who had no choice in their existence? Is that not deeply unjust?

[Blake Stephenson]

I am sympathetic to the point, but I will get on to how unjust and unfair it is to expect other families to pay for those situations, and the fiscal stability and security we need as a country.