The Weekly Round Up: Benefit Cuts, US Tariffs, a Ceasefire Proposal and Care Home Sponsor Licences in the Court of Appeal
17 March 2025
In UK News
Keir Starmer announced plans to cut billions of pounds from the welfare system, specifically working-age health and disability benefits. This week, Starmer called Britain’s benefits system the “worst of all worlds” and has said that the Government could not just “shrug its shoulders and look away” given that the number of people who are out of work or training is “indefensible and unfair”. Ahead of the Spring Statement, Chancellor Rachel Reeves has earmarked several billion pounds in draft spending cuts to welfare and other government departments. Work and Pensions Secretary Liz Kendall has been getting ready to announce changes to the welfare system and reduce the benefits bill. Changes would likely include restrictions on eligibility for the Personal Independent Payment (“PIP”) and cuts to incapacity benefits for those unable to work and receiving Universal Credit.
The Government’s core rationale for making these cuts is that welfare spending has increased dramatically in recent years. Total welfare spending is forecast by the Office for Budget Responsibility (OBR) to reach almost £378bn by the end of the decade because of the ageing and increasingly unwell population, the Government’s triple lock, and rising caseloads for health and disability benefits.
As a result of the proposed cuts, Starmer is facing the most significant rebellion among Labour MPs to date. Rachel Maskell, who previously called on her party to reverse its decision to end universal winter fuel payments, has expressed concern about “draconian cuts”, whilst Neil Duncan-Jordan expressed fear that the move signals a “re-run of austerity”. Reports suggest that dozens of other MPs have expressed concerns in private that Rachel Reeves could make even deeper cuts to working-age benefits than Conservative Chancellor George Osborne. As would be expected, the Government is also facing backlash from charities and campaigners who argue that benefit cuts would affect the poorest and most vulnerable people in British society the hardest. In contrast, the Get Britain Working group of 36 Labour MPs has come out in support of the cuts. They believe the Government has a “moral duty” to help long-term sick and disabled people through making “hard choices” to overcome the “crisis of economic activity”.
Liz Kendall was expected to set out plans in more detail in the House of Commons early next week. However, as of Saturday, Downing Street may now be considering a U-turn on the cuts to benefits in light of the backlash from within the party and following a tense cabinet meeting.
In International News
In the wake of a turbulent Tuesday on Wall Street, Donald Trump’s tariffs came into effect on Wednesday. The United States introduced a 25% tariff on global steel and aluminium imports. These tariffs will cover household goods like tin foil, stainless steel cooking ware, electrical appliances, window frames, among other products. This follows the 25% tariffs that have already been imposed on other imports from Mexico and Canada (with exceptions) and a 20% levy on Chinese goods. Trump, on Tuesday, threatened to double tariffs on Canadian steel and aluminium after Canada threatened to increase electricity prices for US customers, but subsequently backed down later that day. Germany, Ireland and Italy – countries which operate a good trade surplus with the US – are likely to be worst hit by the tariffs.
The European Union has said that it will be imposing counter measures on €26bn (£21.9bn, $28.3bn) worth of US goods in response to Donald Trump’s tariffs on steel and aluminium. The tariffs, which will be brought in gradually between 1st – 13th April to leave time for negotiations with Washington, have been described by President of the European Commission Ursula von der Leyen as “strong but proportionate”. The US has threatened a 200% tariff on wine and champagne from European Union countries in response. Canada, meanwhile, has announced it will be placing retaliatory tariffs on more than $20bn of goods imported from the US. Keir Starmer, in turn, has said that he is “disappointed” about the imposition of US tariffs on British steel and aluminium imports without announcing retaliatory measures.
Turning to the ongoing negotiations around the war in Ukraine, which have been taking place in Saudi Arabia, Volodymyr Zelenskyy has agreed to a 30-day ceasefire, whilst Donald Trump announced the US would lift its restrictions on military aid and intelligence. At the same time, Zelenskyy has emphasised that support from other countries would be needed to monitor the ceasefire along the frontline. Russia has not committed to the ceasefire proposal in its current form, saying that the proposal would give Ukrainian forces a reprieve. The Kremlin has said there are “reasons to be cautiously optimistic” but that there is “still much to be done”. In a virtual meeting with world leaders held on Saturday, Keir Starmer said that Putin’s response to the ceasefire is “not good enough”, and agreed for military planners to meet in the UK on Thursday to “progress practical plans for how our militaries can support Ukraine’s future security”. Meanwhile, in recent days Russia has intensified efforts to push Ukrainian forces out of the Russian region of Kursk, making major advances, including the recapture of Sudzha, the largest town held by Ukrainian forces.
In the Courts
The Court of Appeal has handed down judgement in Prestwick Care Limited, R (on the application of) v SSHD [2025] EWCA Civ 184. This case relates to the circumstances in which the Home Office can revoke a care home’s sponsor licence. The main question in the two joined appeals was whether the Secretary of State is required to assess how revoking a sponsor licence would affect the sponsor, its employees, service users, and wider community care needs before making a decision. The Court of Appeal ruled in favour of the Secretary of State, finding no legal basis in statute or guidance for the additional requirements proposed by the two care homes. The Court held that sponsors should not assume they will receive special consideration solely because revoking their licence could disrupt social care services. It determined that imposing these requirements would be “contrary to the principles established in case law” and would undermine “the regime contained in the Guidance”. Baker LJ emphasised that obtaining a sponsor licence is a choice made by providers for their own benefit but comes with strict conditions set out in the guidance. In applying for a licence, sponsors “know that, if they fail to meet the requirements of the Guidance, the consequences provided for in the Guidance will apply”.
The appeal by Prestwick Care was dismissed on this basis. In the Supporting Care Limited case, the Court ruled that the Secretary of State had succeeded in establishing that the judge at first instance was wrong to allow Supporting Care Limited’s claim for judicial review to succeed on the ground that the Secretary of State had failed to conduct an “adequately reasoned” global assessment of the impact of revocation. However, the Court upheld the first-instance order quashing the revocation on different grounds, namely that the Secretary of State had shown procedural unfairness on the facts in concluding that Supporting Care Limited had “deliberately exaggerated” an employee’s role to facilitate her stay in the UK.
