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A minister has denied misleading Labour voters with a £5bn package of benefit cuts that was not in the party’s manifesto.

Stephen Timms told Sky News Breakfast with Wilfred Frost that Labour pledged to “fix the broken system” during the election campaign and said it would reform or replace the work capability assessment (WCA).

Politics live: PM defends welfare cuts

Scrapping the WCA was one of a series of measures announced on Tuesday, along with narrowing the criteria to qualify for some health and disability benefits.

Labour’s manifesto said: “We believe the work capability assessment is not working and needs to be reformed or replaced, alongside a proper plan to support disabled people to work.”

However, it did not explicitly mention cuts.

Asked if Labour had misled people, social security minister Mr Timms said: “No.”

Stephen Timms on Sky News breakfast
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Stephen Timms on Sky News Breakfast

There’s always a tweet…

It was put to him that his boss Liz Kendall previously tweeted against benefit cuts being considered by former Tory chancellor George Osborne under his austerity programme.

In 2016, the now work and pensions secretary retweeted a colleague who accused Mr Osborne of introducing the cuts “to give handouts to the rich”, alongside a petition campaigning against the measure.

Mr Timms said the Tories “made lots of changes which did a great deal of damage”, including reforms to universal credit which put more people on the higher rate and meant they were “no longer supported into work”.

“We opposed damaging changes the previous government made,” he said.

“We’re bringing forward a package which we think will do the job that’s needed, support people back into work and make the system sustainable financially.”

Read more:
All Labour’s welfare reforms explained

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Benefits cuts Q&A | What do they mean for you?

What measures have been announced?

The most significant measure announced yesterday was making it harder to qualify for personal independence payments (PIP), which is money for people who have extra care or mobility needs as a result of a disability.

The new PIP test will go on to replace the WCA, which currently decides whether people are fit to work or not. There will also be a consultation on delaying access to the health top-up on universal credit until someone is 22.

The announcement was met with criticism from Labour backbenchers, unions and charities, who called for the cuts to be reversed and warned it would push more sick and disabled people into poverty.

However, it is unclear how many people could lose benefits as a result as the impact assessment will not be released until the spring statement next week.

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What to expect from the spring statement

Reforms ‘rushed through’

The spring statement will see Chancellor Rachel Reeves make further spending cuts to account for the loss of around £9bn in fiscal headroom due to a poor economy and global instability.

The government has denied this is the reason for the welfare package, with Ms Kendall telling Sky News’ political editor Beth Rigby she would have announced these measures regardless – as she refused to rule out further cuts.

But Tory shadow chancellor Mel Stride told Sky News the reforms were “rushed” through because Ms Reeves “killed the economy” with her October budget.

“That doesn’t make for good policy, particularly in the area of welfare where you do need to take your time and to be thoughtful about it,” he added.

Shadow Chancellor Mel Stride claims the economy is "flatlining" under Labour
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Mel Stride on Sky News Breakfast

PM: Benefits bill ‘devastating’

Sir Keir Starmer has defended the measures, writing in The Times that the 2.8 million working age people out of work due to long-term sickness is a “damning indictment of the Conservative record” on welfare.

He added: “The result is devastating for the public finances. By 2030 we are projected to spend £70bn a year on working-age incapacity and disability benefits alone.”

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Bitcoin may recover to $90k amid easing inflation concerns after FOMC meeting

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Bitcoin may recover to k amid easing inflation concerns after FOMC meeting

Bitcoin may recover to k amid easing inflation concerns after FOMC meeting

Bitcoin may stage a recovery above the key $90,000 psychological mark amid easing monetary inflation concerns in the world’s largest economy.

Bitcoin’s (BTC) over two-month downtrend has raised numerous alarms that the current Bitcoin bull cycle may be over, defying the theory of the four-year market cycle.

Despite widespread investor concerns, Bitcoin may be on track to a recovery above $90,000 due to easing inflation concerns in the United States, according to Markus Thielen, the CEO of 10x Research.

“We can see some counter-trend rally as prices are oversold, and there is a good chance that the Fed is mildly dovish,” Thielen told Cointelegraph, adding:

“This is not a major bullish development, rather some fine-tuning from the policymakers. We think BTC will be in a broader consolidation range but we could trade back towards $90,000.”

Bitcoin may recover to $90k amid easing inflation concerns after FOMC meeting

Bitcoin daily RSI indicator. Source: 10x Research

Investor confidence may also be improved by Federal Reserve Chair Jerome Powell’s comments indicating that the Fed will “remain on hold amid rising uncertainty among households and businesses,” wrote 10x Research in a March 17 X post, adding:

“Powell also expressed doubts about the sustained inflationary impact of Trump’s tariffs, referencing the 2019 scenario where tariff-related inflation was temporary, and the Fed eventually cut rates three times.”

Meanwhile, investors are eagerly awaiting today’s Federal Open Market Committee (FOMC) meeting, for cues on the Fed’s monetary policy for the rest of 2025, a development that may impact investor appetite for risk assets such as Bitcoin.

Related: Crypto market’s biggest risks in 2025: US recession, circular crypto economy

FOMC meeting will be crucial for Bitcoin’s trajectory: analyst

Traders and investors will be watching for any hints about the ending of the Fed’s quantitative easing (QT) program, “a move that could boost liquidity and risk assets,” according to Iliya Kalchev, dispatch analyst at Nexo digital asset investment platform.

The upcoming Fed decision could be a major catalyst for further movements,” the analyst told Cointelegraph, adding:

“If Chair Powell spreads his dovish wings, Bitcoin could take flight on renewed bullish momentum.”

“However, persistent inflation concerns or a reaffirmation of tight financial conditions, such as elevated interest rates or continued liquidity tightening, could limit upside potential,” added the analyst.

Related: Rising $219B stablecoin supply signals mid-bull cycle, not market top

Bitcoin may recover to $90k amid easing inflation concerns after FOMC meeting

Fed target interest rate probabilities. Source: CME Group’s FedWatch tool

Markets are currently pricing in a 99% chance that the Fed will keep interest rates steady, according to the latest estimates of the CME Group’s FedWatch tool.

Still, investors have slashed their exposure to  US equities by the most on record by 40-percentage-points between February and March, according to Bank of America’s latest survey — raising concerns that recession fears may hurt Bitcoin’s price action.

Magazine: ETH may bottom at $1.6K, SEC delays multiple crypto ETFs, and more: Hodler’s Digest, March 9 – 15

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The Trump-Putin friendship goes on ice

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The Trump-Putin friendship goes on ice

👉Listen to Politics at Sam and Anne’s on your podcast app👈

Sky News’ Sam Coates and Politico’s Anne McElvoy present their guide to the day ahead in British politics.

Sir Keir Starmer’s team spent the day trying to work out how the Trump-Putin phone call really went down. Could the UK end up sending more military support to Ukraine before any pause in fighting?

The idea of an ice hockey game apparently came up on the call – Anne has an important history lesson on that.

Around Westminster, it’s PMQs but the Labour charm offensive to convince its backbenchers of its welfare reforms goes on.

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What are the changes to PIP and other benefits? All the planned reforms to UK welfare system

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What are the changes to PIP and other benefits? All the planned reforms to UK welfare system

The Labour government has unveiled a raft of plans for changes to the UK’s welfare system, which it says will save the UK a total of £5bn.

Work and Pensions Secretary Liz Kendall detailed the government’s planned reforms to the welfare and benefits system in the House of Commons.

Politics latest: Reaction as welfare system reforms announced

She made clear Labour’s motivation, pointing to the sheer cost of long-term sickness and disability benefits for working-age people, which has risen by £20bn since the pandemic and is forecast to hit £70bn over the next five years.

Here, Sky News looks at all the changes Labour plan to make to the welfare system.

Changes to eligibility for personal independent payments

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PIP is a tax-free payment given to people aged 16-64 to help with the extra costs caused by long-term ill-health or disability.

There are two components of PIP: a daily living part designed for those who have a long-term physical or mental health condition or disability, and a mobility part, for those who have difficulty doing certain everyday tasks or getting around.

It’s possible to meet the criteria for one part or both parts, and payments vary for each.

Ms Kendall confirmed on Tuesday the government will change the criteria to reduce the number of people eligible for PIP.

The minister also confirmed the government will not freeze PIP – as reports had previously suggested – but instead make it harder to qualify from November 2026.

People will need to score at least four points in one activity to qualify for the benefit – a move that will require a change in law. This will not affect the mobility component.

All you need to know about PIP changes – read more here

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‘Government’s plan to cut welfare is terrifying’

Boost to standard universal credit

The government has pledged to raise the standard universal credit allowance by £775 in 2029/30.

Universal credit (UC) is available to those who are on a low income, out of work or cannot work.

The benefit is replacing the six you can currently claim – child tax credit, housing benefit, income support, income-based jobseeker’s allowance, income-related employment and support allowance, and working tax credits.

Alongside a hike in the basic rate of universal credit, Labour have pledged to “switch back on” reassessments after a significant drop in the number carried out in the pandemic.

However, the government said claimants with severe, lifelong disabilities will not usually face benefits reassessments.

Ms Kendall told MPs the government “will legislate to rebalance the payments in universal credit from April next year, holding the value of the health top up fixed in cash terms for existing claimants and reducing it for new claimants, with an additional premium for people with severe lifelong conditions”.

The minister said the government will consult on whether the health top up to UC should be delayed for those under 22, with the savings spent on work support and training opportunities.

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Welfare system ‘letting people down’

Scrap work capability assessments in 2028

It was confirmed that work capability assessments will be entirely scrapped in 2028.

Under the current system, those not fit for work are told they have limited capability for work related activity (LCWRA) – which means they will not receive employment support or further engagement from the system after their assessment, potentially locking them out of future work.

However, work capability assessments (WCA) will be scrapped altogether in three years’ time.

Ms Kendall said the WCA is “not fit for purpose”, describing the assessments as “complex, time-consuming and often stressful for claimants”.

Consider merging benefits into new ‘unemployment insurance’

The government has pledged to consult on merging jobseeker’s allowance and employment support allowance into a new, time-limited “unemployment insurance”.

This would be paid at a higher rate – and claimants would not have to prove they are unable to work in order to receive it.

Ms Kendall said: “So if you have paid into the system, you’ll get stronger income protection while we help you get back on track.”

This new “unemployment insurance” benefit would be created by merging jobseeker’s allowance – the benefit paid to people who are out of work but looking for a job – and the employment and support allowance, used for those with a disability or health condition that affects how much they can work.

Legislating for a ‘right to try’ initiative

Lastly, the government has vowed to legislate for a “right to try” initiative.

The minister told MPs this will guarantee that “work in and of itself will never lead to a benefit reassessment, giving people the confidence to take the plunge and try work without the fear this will put their benefits at risk”.

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