John McDonnell fears 'people will lose their lives' if Labour cuts benefits in autumn budget

Former shadow chancellor John McDonnell has said he is “terrified” the government will make “another wrong move” and cut benefits in the autumn budget.

The MP for Hayes and Harlington, who has had the Labour whip removed, warned “people will lose their lives” if austerity measures are introduced.

Speaking exclusively to the Big Issue, McDonnell said: “There’s been a lot of noise about tough choices and painful decisions, and I’m worried they’ll look again at some form of impact on welfare provision.”

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“If you seek to impose austerity measures on people in poverty already, it will cause immense hardship and people will lose their lives,” he added.

Keir Starmer has promised there will be “no return to austerity”, but the government has already slashed the winter fuel payment for millions of pensioners and refused to drop the two-child limit on benefits.

It has pledged to tackle “worklessness” and “welfare fraud”, while considering changes to the disability benefits system proposed by the Conservatives which could see people refused support.

“I’m fearful. I’m terrified of the consequences if they make another wrong move like that,” McDonnell said, adding that there are already “many sad tales” of disabled benefit claimants “starving to death” and taking their own lives.

“The brutality of the measures that have taken place has resulted in such suffering and loss of life, and we’ve got to learn the lessons from that and never allow that to happen again.”

Labour was elected on the basis of change. “People weren’t necessarily marching out because they were supporting Labour’s policies, but because they were desperately trying to get rid of the Tories. People couldn’t cope anymore,” McDonnell says.

He was “absolutely elated to get rid of the Tories”, but he warns the party he has been a member of for 50 years that “we have to be realistic”.

Although Labour won by a landslide in terms of seats in parliament, the party only got 34% of votes. Four in five people did not vote for Labour – either because they voted for other parties, did not vote or they spoiled their ballot.

McDonnell fears that without “radical change” to improve people’s lives, “disillusionment will set in” and feed the far right. “In fact, it has already set in,” he added.

He backs Labour’s plans to renationalise railways, regulate buses and restore trade union rights – which he had fought for alongside Jeremy Corbyn, although there is “almost a ban on mentioning” the former Labour leader’s name now, according to McDonnell.

But the policies which have captured headlines are the “disastrously unpopular” winter fuel payment cuts and the refusal to drop the two-child limit, which are “more about austerity”.

McDonnell was among seven Labour MPs who lost the whip when he voted for an amendment to the King’s Speech which would see the two-child limit scrapped.

It is the “easiest” way to tackle child poverty, McDonnell said. As many as 490,000 children are trapped in poverty because of the two-child limit on benefits, according to recent estimates from the Resolution Foundation.

Introduced by George Osborne when he was chancellor in 2015, the two-child limit means that families are denied benefits for their third and subsequent children born after April 2017.

“The Labour Party abstained and I voted against,” McDonnell recalls. “I think I said I’d swim through vomit to get rid of this policy. I was really angry.

“I will use every occasion I possibly can to vote against it. I wasn’t voting against the King’s Speech. I support the King’s Speech, but I wanted to amend the King’s Speech to get rid of it.”

Labour has established a taskforce to look at ways to tackle child poverty. “That’s great,” Mcdonnell said, “but will that look at scrapping the two-child limit and will there be a deadline?”

He was even more “shocked” – and is “still shocked” – when the winter fuel payment was means-tested ahead of the budget. It means that only pensioners eligible for pension credit and means-tested benefits will get the payment of up to £300 to help with heating bills.

The winter fuel payment was introduced by Gordon Brown when he was chancellor in 1997. Between 2000 and 2012, there was a drop of almost 10,000 in “excess winter deaths” – half of which Labour analysis credited to the introduction of the winter fuel payment.

“If you means-test a benefit like that, unless you introduce a very slight taper, you’ll have lots of people losing the benefit overnight, and it will impact people who desperately need it,” McDonnell says. “I’m worried, certainly about my constituency, not necessarily about the hardship, but I am worried about the excess deaths.

“I’ve been stopped by so many people in my West London constituency, often women who have worked at Heathrow and got a small pension that tips them over the edge of pension credit and now they will lose the winter fuel payment. They’re pretty angry about the whole thing.”

Labour argued wealthy pensioners should not get the payment, but McDonnell thinks the government should look at how it can take wealth back in taxes.

“When it comes to the day to day expenditure on the budget, unless they do something with regard to redistribution through taxation, there are going to be cuts and austerity,” he said.

McDonnell backs calls from the TUC to equalise capital gains tax with income tax which could raise at least £10bn, excluding pensions, and he would like to see stamp duty extended to cover derivatives and bonds, which he claims would raise around £6bn. 

“There’s a whole range of measures like that, relatively minor reforms that you can introduce that will cover all the black holes that they’ve discovered in the budget and all the rest in the finances. But if we are serious about having a fair and more equal society, the reality is, we’ve got to come to terms with taxing wealth.

“I want to see a strategy developed in this budget that is based upon, of course, about investing in the economy, but it is also about a fair taxation system. And in that way, we can fund our public services. We can fund the support that we need for people who require welfare support. But in addition to that, I think we can make our society much more equal.”

McDonnell has backed the Big Issue’s Poverty Zero campaign, which is calling on governments to introduce legally-binding targets to end poverty, and he will be an End Poverty Champion demanding change in parliament.

“Every institution and government should be looking at how you eradicate poverty,” he says. “I cannot believe in the 21st century we’ve got 14 million people living in poverty. Four million children. One million children in destitution. I never thought in my lifetime I’d see it again. It’s appalling. It’s an indictment of our society.”

Life expectancy levels have stagnated for a number of years, and McDonnell believes that is because of austerity. He adds that children in the UK are now shorter than children in the rest of Europe, and that is most likely because of “diet and poverty”. 

“Poverty costs by way of the increase in dependency on public services,” he adds. “If you take child poverty, it impacts upon the health of that child. That immediately falls on the NHS. It impacts upon their ability to be, to learn. That then impacts upon the skills that they acquire, the way that they can function within society and contribute towards the economy. It becomes a vicious cycle.

“If you want a thriving society and a thriving and growing economy, you have to ensure you invest in people. And the way you invest in people is to lift them out of poverty with decent wages and proper welfare support.

“Austerity wasn’t an economic necessity. It was a political choice. They chose austerity because they wanted to protect the rich. That’s what the Conservatives are all about. That isn’t what Labour should be about. Labour was invented to ensure that we don’t live in a society where such grotesque levels of inequality and poverty exist.”

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