Conservative MPs opposed to real-term benefits cuts are working with Labour to force Liz Truss to abandon the plan, a shadow minister has revealed.
Jonathan Ashworth said unhappy Tories have “reached out to me” to find a way to block the big hit to the incomes of the poorest, adding: “There’s a lot of anger on the Conservative side.”
The cross-party talks emerged as a senior Tory predicted Kwasi Kwarteng will be forced to cave in to pressure to release the Treasury watchdog’s verdict on his economic plans early – instead of keeping it under wraps until 23 November.
Mel Stride, the chair of the Commons Treasury committee, also called his party’s mood “fairly febrile”, as MPs head back to Westminster this week with Labour 30 points ahead in the polls.
The twin controversies of the benefits cuts and the Office for Budget Responsibility’s secret forecast are shaping up as the key conflicts when Ms Truss and her chancellor face their rebellious MPs.
No 10 is desperate to bank savings for promised tax cuts by only increasing benefits in line with wages, rather than much-higher inflation – as Boris Johnson promised earlier this year.
But the Child Poverty Action Group is warning 200,000 more children will be pushed into poverty if payments rise by only around 5 per cent, not the inflation rate of roughly 10 per cent.
Mr Ashworth, the shadow work and pensions secretary, said many Conservatives oppose what he called “another unfair, deep cut in the incomes of the poorest”.
“I’m saying to Conservative MPs – some of them have already reached out to me – let’s work together and let’s block this,” he told Times Radio.
“I think there’s a lot of anger on the Conservative side, because we know what’s happening more broadly at the moment.”
Meanwhile, a former Sainsbury’s boss warned the cost of living crisis is the deepest for 50 years as he called on the government to directly help more effectively to the poorest.
“The 1970s is probably the last time the challenges to households were as great,” Justin King told Sky News.
He added: “I don’t think the government should be giving to those people who can afford to pay their bills, so it can give more money to those who are going to struggle. I think targeting is perfectly possible.”
Nadhim Zahawi, the Cabinet Office minister, said: “No decisions have been made on the benefits uprating.” It would normally be made in November – for changes next April.
Mr Stride attacked “too many missteps” and suggested there will need to be more U-turns to regain “fiscal credibility” on top of the climbdown on the plan to scrap the top 45p income tax rate.
“A lot of Conservative MPs are very concerned with where we are with the polls,” he said, adding: “There is a recognition that we have got to turn things around and start doing it very quickly.”
On the OBR report, Mr Stride said: “My best guess, and I’ve said it is only a guess, is that the date will be brought forward.”
