Rachel Reeves faces £5bn black hole if Labour rebels win today – YOUR taxes will fill it

PM Keir Starmer won’t be the only loser if furious Labour rebels shoot down his reforms to out-of-work disability and sickness benefits. It’ll be a nightmare for the Chancellor.

Reeves is banking on the overhaul saving £5billion, by reining in Britain’s ballooning welfare bill. That’s cash she desperately needs to balance the books.

Without it, she'll either have to rip up her fiscal rules or hit voters with yet another round of tax hikes.

One in 10 working-age adults now claims a sickness or disability benefit, with no requirement to look for work. Claims have surged by 800,000 since the pandemic, a rise of 45%, with no sign of a slowdown.

The Office for Budget Responsibility expects total health and disability spending will almost double from just under £50billion today, to more than £100billion by 2030.

Personal independence payment (PIP) claimants are set to soar from two million to 4.3 million this decade.

Younger people are driving the surge, often citing mental health issues. Many would be better off in work. The economy would be better off too.

Starmer can't afford to make concessions. Reeves has been hitting the phones, begging rebel MPs to relent. Fat chance.

But Labour’s left is in open revolt. More than 70 MPs, and reportedly several ministers, are backing a wrecking amendment to block the cuts.

More could join them today.

Rebels claim they’re defending the vulnerable. But they’re ignoring the burden this places on those who do work. They already face the highest tax load in British history.

If Starmer caves, his authority will be shredded. But it’s Reeves who’ll have to pick up the financial pieces.

This rebellion is far more dangerous than the spat over winter fuel payments.

Global bond markets are already spooked. They’re watching every move Reeves makes. Britain now pays 4.5% to borrow money, far more than Germany’s 2.5%, because investors no longer trust us to manage our finances.

The UK shells out £9billion a month on interest alone, more than we spend on defence.

Given that we’re set to borrow another £300billion this year, we can't afford a bond market revolt.

Reeves has staked her credibility on fiscal discipline. If Labour rebels deny her this saving, she’ll have to make it up elsewhere. That means just one thing: more tax hikes.

Analysts already fear she'll raise taxes by £24billion – or even £30billion – in the autumn Budget.

Add another £5billion to the mix, and we’re heading towards last year’s eye-watering £40billion total.

Reeves has repeatedly promised not to go there again. But if Labour insurgents sink her welfare reforms, she may have no choice.

The stakes are enormous. If she loses control of the purse strings, Reeves will suffer more humiliation. And taxpayers will foot the bill.