The United Kingdom's Prime Minister Keir Starmer has insisted his welfare reform agenda remains on track after lawmakers from within his own party forced him to abandon major benefits cuts, describing it as a "moral imperative".

In a speech given in central London on Monday, the prime minister also backed his finance minister, Chancellor of the Exchequer Rachel Reeves, amid opposition from the Conservative Party calling for her resignation, after she rejected claims that she misled the public about the UK's finances ahead of last week's budget.

The government was forced to make a policy U-turn earlier this year on plans to narrow eligibility for certain welfare payments after a revolt by governing Labour Party lawmakers.

Starmer said: "We have to confront the reality that our welfare state is trapping people, not just in poverty, but out of work — young people especially. And that is a poverty of ambition."

He argued the reforms are not about looking politically "tough" but about boosting growth, alongside pledges to expand apprenticeships and guarantee training or work offers for unemployed young people.

The prime minister also highlighted the scrapping of the two child benefit cap, which the Treasury forecast will lift 450,000 children out of relative poverty over five years.

Starmer said economic growth is beating forecasts, but the government must go "further and faster", promising to cut "unnecessary red tape" in infrastructure amid findings that the UK is the most expensive place in the world to build nuclear power.

Critics question Starmer's resolve to cut the benefits bill, noting the 26 billion pounds ($32.6 billion) in tax rises included in last week's budget, with more than a third directed to welfare, reported the Financial Times newspaper.

Income tax rise

An unnamed Cabinet minister has told The Times newspaper that they felt misled by Starmer and Reeves over the budget process, questioning why the public was left to believe an income tax rise was coming if that was never the plan.

In quotes published by the paper on Monday, the person said the Cabinet was not briefed on forecasts from the Office for Budget Responsibility and argued that, had they been, they could have warned against stoking speculation about income tax and undermining manifesto commitments, calling the budget handling "a disaster from start to finish".

On Sunday, Sky News quoted a source at No 10 Downing Street who defended the government, but did not deny the cabinet was kept in the dark about forecasts and the state of the economy.

The source said the prime minister and chancellor produced a budget making "fair and necessary" choices that cut energy bills, tackled child poverty and increased fiscal headroom, which was welcomed by markets, adding: "These were the right choices for Britain."