Labour will have to take a “long, hard look” at what they can promise if they win the next election, a senior MP has warned as Sir Keir Starmer faced further criticism over his plan to uphold the Tories’ two-child benefit cap,
Shadow culture minister Lucy Powell said there was “no money left” for an incoming Labour government to do everything they would want.
Sir Keir caused a huge rift with some MPs when he confirmed his government would retain the Conservative benefit cap that prevents parents claiming Universal Credit for any third or subsequent children.
The austerity policy, introduced by former Chancellor George Osborne, has been blamed for pushing some families into poverty.
Scrapping it would lift around 270,000 households out of deprivation, but cost an estimated £1.4 billion in the first year.
Ms Powell told Times Radio: “It is a really difficult situation that we find ourselves in with the economy having been crushed after 13 years of Conservative government, where our political hopes and aspirations meet headlong into hard economic realities.
“We can’t do everything that we would want to do in the first term of a Labour government, because quite honestly, there’s no money left, to coin a phrase, and we have to take that responsible position.”
Scottish Labour leader Anas Sarwar has spoken out against the plan to keep the cap, alongside senior MP John McDonnell and left-winger Zarah Sultana.
Deputy Labour leader Angela Rayner has previously described the policy as “obscene and inhumane” and union Unison called it “cruel”.
Ms Powell added on LBC: “Both things can be true at the same time, which is that things can be bad policy and an awful situation but that we can’t immediately afford to do something about.
“That is true of a whole range of issues, I’m afraid. After 13 years there is a lot of things that we need to put right and we’ve got action plans to do some of that.”
A Labour insider told the Standard that some senior party officials believe the row could help Sir Keir with the Tory voters that the party has to win over at the next election and “who don’t believe the taxpayer should be funding children that families cannot afford”.
Ms Rayner heard concerns raised by multiple backbenchers at a meeting of the Parliamentary Labour Party on Monday evening despite defences from senior figures.
Jon Trickett, an MP on Labour’s left, referred to House of Commons Library research from last week suggesting that removing the cap would cost around £1.4 billion this year and £1.7 billion next year.
He said: “The country could, and should, immediately take hundreds of thousands of families out of poverty in an instant by ending the two-child benefit cap.”
