How the UK’s welfare funds is larger than Romania’s GDP – and is forecast to be bigger than Colombia’s present nationwide output by 2031
The UK’s welfare spending is forecast to be an eye-watering £353billion this year – more than the gross domestic product (GDP) of Romania or nuclear-armed Pakistan.
Britain’s total benefits bill is also expected to rise to a staggering £431billion in 2031/32, according to the Office for Budget Responsibility (OBR).
This is larger than the current GDP of countries such as Colombia, Malaysia or Vietnam, as estimated by the International Monetary Fund (IMF).
Since becoming Prime Minister, Andy Burnham has promised to ‘get really serious’ about reducing the country’s ballooning social security costs.
But he has ruled out ‘crude cuts’ to benefits and is not expected to introduce major welfare reforms until next year.
Even then, those reforms are not expected to start delivering savings for a number of years.
Tory leader Kemi Badenoch this week piled pressure on the PM to cut welfare spending by setting out her own plans to slash £36billion from the benefits bill.
She noted how Britain ‘is now handing out more than £180billion a year in benefits to working age adults’.
‘It’s more than we spend on our Army, our schools and our police combined,’ Mrs Badenoch added.
‘It is more than £4,000 for every taxpayer in the UK. It is more than the entire GDP of Ukraine.’
Mrs Badenoch’s figure corresponds to the OBR’s estimate of total current welfare spending, but excluding spending on pensioners (£169.8billion).
An analysis of the UK’s total welfare bill – including spending on pensioners – shows it is bigger than a large number of individual countries’ GDP.
For example, the £353billion bill for this year – when converted to US dollars at today’s exchange rate to give $471billion – is larger than the current GDP of Romania ($470billion), Pakistan ($450billion), and Egypt ($443billion).
In its latest economic and fiscal outlook, released alongside Chancellor John Healey’s Budget last month, the OBR also said the UK’s welfare spending is forecast to reach £431billion (or $575billion at today’s exchange rate) in 2031/32.
This would be higher than the current GDP of Colombia ($573billion), Malaysia ($547billion), and Vietnam ($542billion).
It is also almost exactly half the current GDP of Poland ($1.133trillion), as estimated by the IMF.
Mr Burnham last week admitted cutting the costs of Britain’s ballooning welfare bill will require the Government to spend more in other areas.
He suggested Labour would have to first ‘invest’ to tackle the almost one million young people not in education, employment or training – so-called Neets.
The PM is not expected to bring forward welfare reforms until next year, following the publication of a major report on the Neets crisis, led by ex-health secretary Alan Milburn.
Another report by Stephen Timms, the social security minister, on disability benefits is also due to be published in the coming weeks.
