The Government’s U-turn on welfare cuts will cost taxpayers around £2.5 billion by 2030, the Work and Pensions Secretary has told MPs as she laid out concessions to Labour rebels.

Liz Kendall said the costs and savings of the Government’s revised welfare package would be confirmed by the Office for Budget Responsibility at the budget in the autumn.

But her statement to MPs on Monday suggested the measures would save less than half the £4.8 billion the Government had expected from its initial proposals.

Ms Kendall’s statement confirmed the concessions announced last week in an effort to head off a major rebellion by Labour backbenchers, including protecting people who claim personal independence payments from new eligibility criteria.

Responding to claims this would create a “two-tier” benefits system, Ms Kendall said: “I would say to the House, including members opposite, that our benefits system often protects existing claimants from new rates or new rules, because lives have been built around that support, and it’s often very hard for people to adjust.”

Earlier, modelling from the Department for Work and Pensions (DWP) suggested the Government’s proposals would push 150,000 more people into poverty by 2030.

The figure is down from the 250,000 extra people estimated to have been facing relative poverty after housing costs under the original proposals.

Modelling published by the DWP said the estimate does not include any “potential positive impact” from extra funding and measures to support people with disabilities and long-term health conditions into work.