The Student Room Group

Rachel Reeves did the right thing in ending winter fuel payments

Scroll to see replies

Original post by Trinculo
No. You're right.
The RMT aren't militant at all.
Here's Mick Lynch calling for RMT branches to affiilate with a Palestine Solidarity campaign, and bring flags and banners to a Central London protest.
https://www.rmt.org.uk/about/policies/political-circulars-and-submissions/israel-palestine130524/
Because obviously this is how you get "decent work conditions" for British workers.
The same RMT that staged walkouts over tube drivers sacked for failing drugs tests.

"MILITANT UNIONIST!!!!!" for encouraging members to join a demonstration...?

There's a word to describe how sensitive you must be to feel that way. The right are very familiar with it.
Original post by Cotes1
He then has weekly extra income above pension credit x 52 = 772.20, I think, excuse my maths.
Arguably this compensates him for not getting 300 fuel allowance.
A pension credit claimant could be passported to full council tax support so we could factor this in.
On that level of income he would still get some council tax support if savings are below 16,000. He could still be better off, on a simplistic level, in theory, if we say the 772.20 covers 300 fuel allowance equivalent and some contribution to council tax. He is no worse off than the pension credit claimant who gets fuel allowance, and full council tax support, probably a bit better off (again without knowing full circumstances, just looking at it as a simple example).
If someone is 5 over the pension credit applicable amount cut-off, then they potentially lose out at that point. Their additional income is 260 a year, they may well still have to pay a small amount of council tax still as they may not get full council tax support, depending on savings and other factors. They have 260 additional income, a small amount of which may go to council tax, in comparison with the pension credit claimant on full CTS and fuel allowance. The pension credit claimant with the 300 fuel allowance is at that point potentially better off but not better off by a full 300 (a simple and very approximate guesstimate example only).
Thinking about it, it is when we move into the area of pensioners just, say, on a weekly basis, 2 above the pension credit cut off point, that there will be more financial impact, regarding the loss of the winter fuel allowance. They are still probably not worse off by the full 300 though as they get additional income above the pension credit cut-off point.

The gentleman concerned has a total weekly income of £233, just £14.50 over the Pension Credit threshold.

But I understand the points that you are making in your comment. The closer someone is to the threshold, the more unjust the change will appear to them and to their families, not to mention very many Labour MPs.
Original post by SHallowvale
There will always be someone who is "just over" the limit, unless the allowance was given universally. The question should be 'is the limit reasonable'?
£233 a week is £12,116 a year without tax. Is that enough for a pensioner to live off? If it isn't, would an additional £300 seriously improve matters?

I should have thought that the lower a person's income, the more grateful they would be for any extra penny they could get.

To add insult to injury, those who qualify for Pension Credit will also qualify for a raft of other benefits, such as full Council Tax relief (for those who live alone), free NHS dental care and Cold Weather Payments. Those who find themselves a pound or two above the threshold are thus significantly worse off. That shows just how dysfunctional these 'cliff edge' thresholds can be.
Reply 23
Original post by Supermature
The gentleman concerned has a total weekly income of £233, just £14.50 over the Pension Credit threshold.
But I understand the points that you are making in your comment. The closer someone is to the threshold, the more unjust the change will appear to them and to their families, not to mention very many Labour MPs.

Wasn't making the point about it appearing unjust, though it probably does appear unjust to a number of people. I was just working out who might financially suffer the most.


If that is his total income and his savings are below 16,000 then he may be entitled to council tax support. If that is the case, he should try claiming it.
(edited 1 month ago)
Original post by Gazpacho.
For you elderly gentleman, £221.20 of his weekly income will be state pension. He has had his entire working life to build up a pension pot for himself.
part of my job involves financial assessments. I see a lot of people in their 30s and 40s who choose not to pay into private pensions. They are going to be in this situation when they hit retirement age and they’ll be turning to the government to help them.
Of course. I’m not beyond tapering or increasing the threshold. However that requires an administrative structure that will likely cost the government as much as it saves.
In these debates, people always bring up money spent abroad or on the military as if they think geopolitics is about unicorns and rainbows. The money spent on Ukraine or munitions for Ukraine is not just a hand out to support the Ukrainian people. There is a far broader geopolitical goal. Western hegemony retreating in the face growing authoritarianism is going to be a central theme of the 21st century. If Russia gets a whiff that it can expand without consequences, losing winter fuel payments will be the least of our problems.

"I’m not beyond tapering or increasing the threshold. However that requires an administrative structure that will likely cost the government as much as it saves."

And that's exactly the point: this was not a change motivated by fairness but simply a cost-cutting measure. Credit where credit is due, the Government has been honest about that.

But the question then arises as to whether this was the most appropriate and politically astute way to balance the books.

At times it appears as if all UK governments go out of their way to show contempt for their own citizens.

This is not the place to discuss the merits of supporting or not supporting Ukraine. But for a Labour Government to announce a £3 billion per annum subsidy to another country, while at the same time withdrawing a universal payment costing half that amount that has been made every year since it was introduced by an earlier Labour Government in 1997, would seem particularly inept. Meanwhile, the Social Democrat (Labour) led coalition in Germany has halved and subsequently halted military aid to Ukraine as part of the ruling coalition's plan to reduce spending.

As for the elderly gentleman to whom I referred, he would have had no understanding of the need to build up a 'pension pot'. He would have lived through a time when the expectation was that the state would provide for its citizens in their old age. Had he earned a little more, he would have paid into the State Earnings Related Pension Scheme devised by Barbara Castle when we had a Labour government that tried to live up to its name.
Original post by Cotes1
Wasn't making the point about it appearing unjust, though it probably does appear unjust to a number of people. I was just working out who might financially suffer the most.
If that is his total income and his savings are below 16,000 then he may be entitled to council tax support. If that is the case, he should try claiming it.

But he would still most likely be worse off than someone on Pension Credit with a marginally smaller income, would he not?

The problem, once again, is that this was a cost-cutting measure, made with little regard to all the consequences.

https://www.theguardian.com/politics/article/2024/sep/10/well-get-the-blame-tensions-simmer-within-labour-over-winter-fuel-cut
Original post by Supermature
I should have thought that the lower a person's income, the more grateful they would be for any extra penny they could get.
To add insult to injury, those who qualify for Pension Credit will also qualify for a raft of other benefits, such as full Council Tax relief (for those who live alone), free NHS dental care and Cold Weather Payments. Those who find themselves a pound or two above the threshold are thus significantly worse off. That shows just how dysfunctional these 'cliff edge' thresholds can be.

Perhaps, but I suppose my question is: what is the alternative? Making these benefits universal would obviously stop there from being a threshold that people are 'just over', but it also comes with a enormous cost paying for things that the government shouldn't pay for (e.g. fuel payments for pensioners with deep private pensions).
Reply 27
Original post by Supermature
But he would still most likely be worse off than someone on Pension Credit with a marginally smaller income, would he not?
The problem, once again, is that this was a cost-cutting measure, made with little regard to all the consequences.
https://www.theguardian.com/politics/article/2024/sep/10/well-get-the-blame-tensions-simmer-within-labour-over-winter-fuel-cut

No he would not be. As I said above.
(edited 1 month ago)
Reply 28
Original post by Supermature
"I’m not beyond tapering or increasing the threshold. However that requires an administrative structure that will likely cost the government as much as it saves."
And that's exactly the point: this was not a change motivated by fairness but simply a cost-cutting measure. Credit where credit is due, the Government has been honest about that.
But the question then arises as to whether this was the most appropriate and politically astute way to balance the books.
At times it appears as if all UK governments go out of their way to show contempt for their own citizens.
This is not the place to discuss the merits of supporting or not supporting Ukraine. But for a Labour Government to announce a £3 billion per annum subsidy to another country, while at the same time withdrawing a universal payment costing half that amount that has been made every year since it was introduced by an earlier Labour Government in 1997, would seem particularly inept. Meanwhile, the Social Democrat (Labour) led coalition in Germany has halved and subsequently halted military aid to Ukraine as part of the ruling coalition's plan to reduce spending.
As for the elderly gentleman to whom I referred, he would have had no understanding of the need to build up a 'pension pot'. He would have lived through a time when the expectation was that the state would provide for its citizens in their old age. Had he earned a little more, he would have paid into the State Earnings Related Pension Scheme devised by Barbara Castle when we had a Labour government that tried to live up to its name.

Not judging him, I am not one to talk about lack of pension planning, but my mother is in her 80s and she was pretty focused on building a pension pot. She doesn't recall thinking she could rely on the state as a pensioner. Not sure all people thought like him.
(edited 1 month ago)
Original post by Cotes1
No he would not be.

In that case, I wonder what all the fuss is about! 😉
Reply 30
Original post by Supermature
In that case, I wonder what all the fuss is about! 😉

What do you mean please?

Your friend is over 14 quid above the threshold.

That is why.

Someone who is 2 above ...that is different.

I am only basing it on pension guarantee credit and council tax support as a simple example.There are many other factors which can alter the financial/benefits situation.
(edited 1 month ago)
Reply 31
Original post by SHallowvale
Perhaps, but I suppose my question is: what is the alternative? Making these benefits universal would obviously stop there from being a threshold that people are 'just over', but it also comes with a enormous cost paying for things that the government shouldn't pay for (e.g. fuel payments for pensioners with deep private pensions).

I think a good alternative would be a form of mean-tested tapering (maybe like housing benefit works) in relation to the fuel allowance, not just using pension credit as a measure of entitlement. This would mean that pensioners with income above pension credit could still qualify for it but wealthier pensioners won't. That involves much more planning and there is a cost to it.

Labour would have to throw money at a better scheme. The Pension Service can't even process existing pension credit claims let alone cope with more. It is an appalling service. Like I say, they can take 9 months and longer to process many simple claims when their guidance is 6 weeks. And that is with regular chasing up. What an absolute **** show.
(edited 1 month ago)
Original post by Cotes1
Not judging him, I am not one to talk about lack of pension planning, but my mother is in her 80s and she was pretty focused on building a pension pot. She doesn't recall thinking she could rely on the state as a pensioner. Not sure all people thought like him.

In the 1960s it was not common for low paid manual workers to be part of a pension scheme. They simply relied on their state pension and on any savings they could muster. The State Earnings Related Pension was introduced by Barbara Castle, the Labour Social Services Secretary, largely to address that issue. It was subsequently abolished by the Conservatives.

Many professional and skilled technical staff had final salary pension schemes, which guaranteed them a percentage of their final salary in retirement. Teachers would be a good example.

Thus the concept of a 'pension pot' was alien to a large part of the working population.
Original post by Cotes1
What do you mean please?
Your friend is over 14 quid above the threshold.
That is why.
Someone who is 2 above ...that is different.
I am only basing it on pension guarantee credit and council tax support as a simple example.There are many other factors which can alter the financial/benefits situation.

Forgive me, I did not mean to sound contentious.

Perhaps I'm a little pampered but £14 per week does not sound like a great deal over the threshold to me.

The BBC article that I cited shows just how much concern this policy has caused inside the Labour Party. I suspect that Rachel Reeves now regrets ever having thought of it (unless she was bowing to pressure from inside the Treasury, as some have suggested.)
Had it not become a credibility issue it would have been reversed.

There would still be the option of taxing and/or tapering the allowance but, as has been pointed out, that would not have saved much money.
Reply 34
Original post by Supermature
Forgive me, I did not mean to sound contentious.
Perhaps I'm a little pampered but £14 per week does not sound like a great deal over the threshold to me.
The BBC article that I cited shows just how much concern this policy has caused inside the Labour Party. I suspect that Rachel Reeves now regrets ever having thought of it (unless she was bowing to pressure from inside the Treasury, as some have suggested.)
Had it not become a credibility issue it would have been reversed.
There would still be the option of taxing and/or tapering the allowance but, as has been pointed out, that would not have saved much money.

Depends on context. 14 is a lot of money on a weekly basis when you are on a low income.

I regularly deal with single pensioners on less than 200 a week who haven't claimed their full benefit entitlement...14 is a lot to them.

I was just explaining that there is a difference between 14 and 2, above the PC threshold, in terms of the way pensioners are affected by the loss of a 200/300 fuel payment, when attempting comparisons.
(edited 1 month ago)
Original post by Cotes1
14 is a lot of money on a weekly basis when you are on a low income.

Indeed it is. But I think most people would regard someone whose income was only £14 beyond the threshold as still being not very well off and should therefore be entitled to receive the allowance in full or part.
Original post by Cotes1
14 is a lot of money on a weekly basis when you are on a low income.
I regularly deal with single pensioners on less than 200 a week who haven't claimed their full benefit entitlement...14 is a lot to them.
I was just explaining that there is a difference between 14 and 2, above the PC threshold, in terms of the way pensioners are affected by the loss of a 200/300 fuel payment, when attempting comparisons.

I take your point. The closer to the threshold, the greater the impact and, for many if not all, the greater the feeling of unfairness.
Original post by Cotes1
I think a good alternative would be a form of mean-tested tapering (maybe like housing benefit works) in relation to the fuel allowance, not just using pension credit as a measure of entitlement. This would mean that pensioners with income above pension credit could still qualify for it but wealthier pensioners won't. That involves much more planning and there is a cost to it.
Labour would have to throw money at a better scheme. The Pension Service can't even process existing pension credit claims let alone cope with more. It is an appalling service. Like I say, they can take 9 months and longer to process many simple claims when their guidance is 6 weeks. And that is with regular chasing up. What an absolute mess.

You've hit the nail on the head here.

This is similar to what I said in my earlier posts, although I would simply have chosen to make the payment taxable, with a complete phased withdrawal for higher earners (as with the Income Tax Personal Allowance). We have merely suggested two different mechanisms to arrive at the same end. 😉
Despite the opportunism of my fellow Tories in their opposition, I too support the means testing of that winter fuel allowance.

Indeed I'd probably go further and abolish it completely since it appears aimed at pensioners. There's no reason for small giveaways when we can just raise the state pension a bit.
I'm inclined to agree with OP's main premise in a world of the triple lock state pension, it's a policy whose time has been and gone. And with the new government having a different electoral coalition, the media and political landscape is clearly still adjusting to the grey vote not driving the agenda as it did under the Conservatives.

That said, it's frustrating to not hear ministers make a proper case for why this sort of universal payment is unjustified and focus should be on supporting different people.

Quick Reply