Amelia Gentleman belatedly posted the full quote from Reeves in context, under her article - the one which is at the centre of this furore:
"Is it a problem if Labour is seen as the party of the welfare state?"
"Yes of course, but we’re not. We don’t want to be seen, and we’re not, the party to represent those who are out of work. Labour are a party of working people, formed for and by working people – the clue is in the name. We are the Labour party – we are not the party of people on benefits. But the welfare state was always supposed to be there to protect people in times of need, whether that was because they lost their job, or they became disabled, or they had a child who is disabled, to help with the cost of childcare, to help you when you are no longer earning because you are retired. That's what the welfare state was created for. I want to ensure that the welfare state is there for my children and their children in the future."
Apparently Amelia didn't post the full quote, its slightly different in nuance?