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Rachel Reeves will “of course” be chancellor in six months’ time, a senior ally of Sir Keir Starmer has said, despite last night’s humiliating showdown over welfare cuts.
Pat McFadden, the chancellor of the Duchy of Lancaster, admitted there would be a “cost” to the government’s decision to effectively neuter its welfare bill, which was intended to save Ms Reeves around £5bn but now leaves her with an estimated £5.5bn black hole.
Speaking to Kamali Melbourne on Sky News’ Breakfast Mr McFadden acknowledged it had been a “tough” few weeks for the government as it faced down its backbenchers over proposals to shake up the welfare system.
Politics latest: Tories go on the attack against Rachel Reeves
The prime minister’s watered-down Universal Credit and Personal Independent Payment Bill, aimed at saving £5.5bn, was backed by a majority of 75 in a tense vote on Tuesday evening.
A total of 49 Labour MPs voted against the bill – the largest rebellion in a prime minister’s first year in office since 47 MPs voted against Tony Blair’s Lone Parent benefit in 1997, according to Professor Phil Cowley from Queen Mary University.
Ms Reeves has borne a lot of the criticism over the handling of the vote, with some MPs believing that her strict approach to fiscal rules has meant she has approached the ballooning welfare bill from the standpoint of trying to make savings, rather than getting people into work.
Experts have also warned that the welfare U-turn, on top of reversing the cut to winter fuel, means that tax rises in the autumn are more likely.
Asked whether he believed Ms Reeves would still be in her job in the next six months, Mr McFadden replied: “Of course she will. She’s doing an excellent job. We take these decisions as a team. We stand as a team, and we go forward as a team.”
The senior cabinet minister sought to downplay the chaotic scenes that unfolded in the Commons last night, when the government pulled the most controversial elements of…
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