Political reporter
Sir Keir Starmer has announced plans to ease cuts to winter fuel payments, in a U-turn following mounting political pressure in recent weeks.
More than 10 million pensioners lost out on the payments, worth up to £300, when the pension top-up became means-tested last year.
Speaking at Prime Minister’s Questions, Sir Keir said ministers would change the threshold to allow “more pensioners” to qualify again.
But it remains unclear how many will regain their entitlement for the payments, or when the changes will take effect.
Sir Keir said the policy would be changed at the autumm Budget, adding ministers would only “make decisions we can afford”.
The winter fuel payment is a lump-sum amount of £200 a year for pensioners under 80, increasing to £300 for over-80s, paid in November or December.
It was previously paid to all pensioners, but 10.3 million lost out last year after the government restricted eligibility to those who qualify for pension credit and other income-related benefits, to save an estimated £1.4bn.
The move, announced shortly after Labour took office last July, led to fierce criticism from unions and pensioner charities.
But pressure to change course has grown in recent weeks, with some Labour MPs and councillors blaming the policy for the party’s losses at last month’s local elections in parts of England.
Grumbling from MPs generally on the Labour left spread into the party more widely, and even MPs who defended the policy said it was the most frequently raised issue by members of the public.
‘Longest U-turn’
It had been thought a change in approach could be confirmed at next month’s spending review, when the government will set out departments’ budgets for the coming years.
But in a surprise move, Sir Keir confirmed the policy U-turn in response to a Labour backbencher’s at Prime Minister’s Questions.
Tory leader Kemi Badenoch did not respond immediately to the announcement, waiting until the fourth of her six allotted questions to mention it.
She later denied she had been wrong-footed, telling reporters she “had to talk” about rising inflation figures first, and the order of her questions was “not what people out there care about”.
She welcomed the “inevitable” U-turn, but called on the government to set out “early” details of their new approach, adding that autumn’s Budget would be too late to deliver changes this winter.
She did not specify where she wanted the new threshold to be set, but added she did not think that “millionaires” should qualify again.
Liberal Democrat leader Sir Ed Davey welcomed the “longest U-turn” from the government, and called for the cuts to be reserved “in full”.
The income threshold for pension credit, the main benefit to qualify to continue to receive winter fuel payments, is currently £11,800 for individuals and £18,023 for pensioner couples.
Designing a new eligiblity threshold will now present political and practical headaches for ministers ahead of the Budget in the autumn.
Age UK, one of the charities opposing the cuts, welcomed the change in approach but said any new system should ensure pensioners on “low and modest incomes” would be able to keep the payments.
Triple lock
Asked by reporters when the changes would take effect, the prime minister’s spokesman declined to guarantee it would be in place this coming winter, but added: “We obviously want to deliver this as quickly as possible.
“We will only make decisions when we can say where the money is coming from, how we’re going to pay for it and that it’s affordable,” he added.
The winter fuel payment was introduced in 1997 by New Labour as a universal payment for all pensioners.
It was billed as a way to guarantee they would be able to pay for increased heating costs over the winter – although in practice it is a pension top-up, which recipients can spend on whatever they want.
From 2010 onwards, the state pension gained additional protection under the “triple lock” policy – under which pensions go up each year by the highest of inflation, average earnings or 2.5%.
This year state pensions went up by 4.1% – a rise of £363 a year for those on the basic pension or £472 for those on the new pension.
