Welfare reform will not save Andy Burnham

Andy Burnham repeatedly claims that he can fund defence using savings from the welfare budget – just not the ‘crude cuts’ that the Tories want him to make. But today his own adviser on youth unemployment has rather undermined that: Alan Milburn has confirmed to the Financial Times that the plans he has for Neets will cost more money upfront and take time to produce savings. ‘Honestly, in order to fix this, if we’re going to get to anywhere near the [Neet] levels of Holland or even Belgium, that that is not going to happen in two or three years,’ he said. He added: ‘If we’re going to put in more support for young people… of course we’re going to have to invest behind that’.

This is not a surprise. Proper welfare reform is very much not the same as welfare cuts, even though in time it can deliver better and more sustainable savings than simply lopping chunks out of the budget. The key phrase here is ‘in time’. Milburn has made clear that what he envisages won’t deliver in the next three years, which makes it impossible for Burnham to be able to get the savings he’s after in order to say he can get defence spending to reach 3 per cent of GDP by 2030. 

Along with his jaw-dropping assertion at Prime Minister’s Questions this week that national security ‘can’t come at the expense of social security’, Burnham insisted that ‘we on the labour benches will not be forced to choose between the two’. But here is Milburn, saying that he won’t deliver the savings Burnham wants in time for the purpose he says he would use them for. And at that point, the Prime Minister is either going to have to accept that alongside reform, he will have to announce cuts that others might consider to be ‘crude’ to get any money out of the welfare bill in good time, or that the money is going to have to come from somewhere else. 

Burnham has a much better way of talking about the morality of reforming welfare than his predecessor. He has passion and a sense that he’s actually paid this policy area attention. But he and Keir Starmer have the same parliamentary party, and Burnham is at the disadvantage that the party is much more restive on welfare as a result of the way Starmer and Rachel Reeves botched their cuts. Even if he does conclude that he will have to announce actual cuts that he cannot dress up as reform, he’ll know that the Labour backbenches won’t cope very well with that. Perhaps a continuation of his line this week would be that national security cannot come at the expense of social security, and social security reform cannot come at the expense of party harmony.