Iain Duncan Smith is “pushing back” against attempts to “salami slice” through the welfare budget to deliver the prime minister’s pledge of £12bn in savings, allies of the work and pensions secretary have claimed.
Duncan Smith was surprised when the sheer scale of the cuts was announced in January last year, and is now fighting a rearguard action against changes that would involve slashing at key benefit schemes in his budget.
It is understood the cabinet minister has long been frustrated by a failure within the leadership of the party to get to grips with how the reduction in spending will be made. He fears that such lethargy could ultimately lead to rushed and deeply unpopular cuts.
One ally of Duncan Smith told the Observer that a major problem had been that key figures did not expect to have to implement such heavy hits on welfare spending, assuming the pledge could be watered down during coalition negotiations with the Liberal Democrats.
Now that the Tories are in government with a majority, the source claimed Duncan Smith was standing firm against attempts to slice off bits of his budget to fund a series of giveaways, including slashing inheritance tax and raising the 40p tax threshold to benefit people on twice the national average wage.
“You have two sides of the ledger – the cuts and the giveaways – and people didn’t think they would have to go through with them,” one source said. “Iain Duncan Smith was surprised when the cuts were first announced in January, and that tells you where the push-back in government on this is now.”
A second source close to Duncan Smith confirmed that the cabinet minister believed that there could be no “salami slicing” of the welfare budget, but insisted that he was committed to the £12bn figure and was “confident he can do that”, although only through wholesale “structural reform”.
“He might have wanted agreement on the detail earlier,” the source said, “but, as the person whose job it is to see this through, he is committed and believes you can do it through behavioural change.”
A Downing Street spokesman denied that the work and pensions secretary was “squeamish” over the scale of cuts, and claimed the cabinet was united in wanting them to form part of wider welfare reform.
News of the government’s internal debate over delivering the welfare cuts comes ahead of Wednesday’s Queen’s speech, in which Cameron hopes to flesh out his vision of “blue collar Conservatism”. At the centre of the speech will be a new law to ensure no one working 30 hours on the minimum wage pays any income tax in the future.
The government has also announced that it is freezing ministerial pay for the duration of this parliament. The pay freeze will save an estimated £800,000 a year, or £4m in total.
In a statement, the prime minister said: “There are still difficult decisions to take as we complete the task of clearing the deficit. As we take those decisions, my approach is simple: we will do it in a one-nation way. We are all in this together: so I am freezing ministerial pay for the next five years.”
Ministers also receive a salary as an MP, which is determined by the Independent Parliamentary Standards Authority (Ipsa), rather than the government.
In a 2013 report, Ipsa determined that MPs’ pay would increase on a one-off basis by 10% following the 2015 election. This planned rise is subject to a statutory review by Ipsa later this year. A source said the prime minister believed it was “not right” for MPs’ pay to rise by the levels determined by Ipsa and has urged it to look at the issue again.
It also emerged that plans to speed up child adoption rates are to be included in the Queen’s speech. Under the proposals, local authorities will be forced to merge their services, allowing children to be matched with new families sooner.
The government believes adoption is “happening at too small and localised a scale”. There are more than 3,000 children waiting to be matched at present – and the majority of them have spent more than 18 months in care.
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