Labour intends to cut billions from the disability benefits budget.

The Labour Party are planning on axing billions of pounds worth from disability benefits in order to calm its debts crisis.

Downing Street is said to believe that significant reductions are needed in the welfare budget, namely from personal independence payments (PIP).

Yesterday, the pound experienced a significant decline in value compared to the dollar, while the Government's borrowing costs surged to their highest level in 27 years.

There have been alerts indicating that if the escalating crisis persists, it may impact mortgage rates.

Now, Chancellor Rachel Reeves is said to have made it clear to the Treasury that she wants to get “tough” on spending - meaning cutting areas in unprotected departments - rather than considering new tax rises, the Telegraph reports.

The yearly expenses for support payments to individuals with disabilities and health issues are projected to rise from £22 billion to £35 billion by the year 2029.

Former Treasury select committee chairman Harriet Baldwin accused the Chancellor of ‘fleeing to China’ after realising ‘she is the arsonist’ with the economy.

She stated to the Mail: "The Chancellor must own up to the continuing consequences of her Budget decisions and come back to address Parliament."