The government’s controversial welfare reform bill has overcome its first hurdle in parliament after it saw off a major rebellion by backbench Labour MPs but only thanks to a series of last-minute concessions.

MPs voted by 335 to 260 to give the Universal Credit and Personal Independence Payment Bill their initial approval. But the result saw the government’s working majority cut from 165 to 75.

The government argues that the bill will support more disabled people into work who currently feel ‘trapped’ in the welfare system, while also saving estimated £2.5 billion from the welfare budget.

However, the plans were met with significant opposition from Labour MPs, disability charities and campaign groups who said the severity of the cuts – particularly those to the personal independence payment (PIP) – would push an additional 150,000 people into poverty.

Despite a series of concessions, including changes to the PIP proposals, the Labour government feared it could still lose the vote if further changes were not made. During yesterday’s debate, the Minister for Social Security and Disability, Sir Stephen Timms, announced that the government were abandoning any changes to PIP until after a review of the benefit had concluded. This dropping of the bill’s flagship measure represents a major climbdown on the original plans.  It also means the government’s proposed welfare reforms will now save the Treasury no money at all, according to the Institute for Fiscal Studies.

Following the vote, Dr Ruth Allen, the chief executive of the British Association of Social Workers, said: “Disabled people across the UK have endured months of uncertainty, worry and stress because of the original proposals in this ill thought-through welfare bill and how it has been handled in recent weeks. They have been badly let down by government’s proposals and by the lack of co-production with people affected by proposed changes to vital support.

“The government’s climbdown on changes to PIP is welcome, but these ill-thought proposals need much further amendment to make them fit for purpose and fair. And the proposed deep cuts to Universal Credit included in the Bill are extremely worrying.

“Reforming our welfare system through focusing more on helping people back to work could be a laudable aim but current proposals will worsen not improve living standards and quality of life, are likely to backfire as worsened health and social outcomes will further exclude people from being able to work and participate fully in society and are creating political turmoil which could have been avoided.

“It’s fundamental that the government now commits to genuine dialogue with disabled people to shape reforms centred on the rights and dignity that they need and deserve. If this Bill cannot adequately protect the most vulnerable in our society from hardship or prevent demand on social work services from increasing, then the government must withdraw it.”

Jon Sparkes, chief executive of learning disability charity Mencap, added: “The last-minute change relating to the review Sir Stephen Timms is leading sounds positive and we are pleased that the Government has listened.

“It is very important that this review is thorough and includes people with a learning disability. Fair and sustainable change to the welfare system will only happen if the people who rely on it are listened to.

“Disabled people should not have to pay to fix black holes in the public finances.”