Clegg gets specific on cuts: Lib Dems to cut winter fuel payments for under-65s

So reports the BBC:

The Liberal Democrats have said if they won power they would stop the winter fuel allowance for people under 65. Anyone aged 60 can claim the allowance, worth £125 to £400, but the minimum age is due to rise to 65 in 10 years’ time.

Lib Dem leader Nick Clegg said his party would implement the change now – saving about £400m in public spending. He said just under £200m would be used to give extra winter help to about one million severely disabled people or those who are terminally ill. …

Mr Clegg told the BBC his plan would not only save money, but put “extra fairness into the system”, by helping about a million people who currently do not qualify for the allowance.

“We say you should bring that rise in the eligibility age forward to now, that saves you about £400m and you could use some of that money to actually provide extra winter fuel payments to the very disabled or those who are terminally ill.

“Those are the kind of difficult, detailed choices which we are putting forward that no other party is being open enough about with the British public.”

This is a calculated risk on Nick Clegg’s part. The cut is a specific one, and will hit an easy-to-identify segment of the population: 60 to 65 year-olds.

It is also a move from a universal benefit – in which you accept that some who benefit do not need the money in return for increased take-up and lower administrative costs – towards targeted benefits. Nick has ruled this out in the case of child benefit, though Vince Cable is known to favour tapering the family element in tax credit.

Such are the (potential) downsides. More positively, Nick is able – rightly – to point to the fact that while Labour and the Tories talk about the need for cuts and tough choices, only the Lib Dems are so far being brave enough to put their heads above the parapet and identify actual cuts that will save money.

The question is: will that honesty convert into votes?

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19 Comments

  • Brave, after a cold winter, and when fuel prices are high. It is easy to misconstrue as well – “LDs will take the winter fuel payment away from millions of vulnerable pensioners”…

    BTW I thought tapering the family element in the tax credit was policy – doesn’t it provide a chunk of the funding for the pupil premium? Or am I out of date?

  • Wow, thats a vote winner – not.

  • I see we have now started a process of inverse targeting – identify the specific groups that we will target NOT to vote Liberal Democrat! I wonder which fools thought this up.

    Tony Greaves

  • Anthony Aloysius St 23rd Mar '10 - 12:40pm

    It does seem odd to be trumpeting a policy like this that will result in a net saving of just over a thousandth of the projected annual deficit.

    I never heard that it was considered good tactics to release bad news drip by drip …

  • Just to clarify some elements of the policy –

    We are proposing to extend the WFP to individuals in receipt of the higher rate mobility component of Disability Living Allowance (DLA), to those receiving the higher rate care component of DLA because they are terminally ill, and to families who have severely disabled children under the age of 5. It is targetted at these groups because they spend more time in their homes and therefore have higher fuel costs, yet they are also at a high risk of living in poverty.

    On the other side of the equation, we are going to raise the age at which older people receive the WFP. At present anyone over 60 can claim the payments, but Government is increasing the age of eligibility to 65 in line with the increase in the state pension age for women (65 by 2020). We will simply increase the age of eligibility for WFP to 65 immediately. Many people in this age group are still working and the benefit is not at all well targeted. Of course, anyone aged 60-65 who has disabilities as set out above will continue to receive the WFP.

    On an unrelated point but one raised by Tim at the top of the thread, it is our policy to taper the family element of tax credit. Child Benefit is a different thing.

  • Peter,

    Winter Fuel Payment is awarded purely on age. You get it when you are over 60 as of right whether you are a man or woman. See the Government website, which is very clear on this http://www.direct.gov.uk/en/MoneyTaxAndBenefits/BenefitsTaxCreditsAndOtherSupport/Inretirement/DG_10018657

    I think you may be confusing this with Cold Weather Payments which are paid to people on means-tested benefits such as pension credit. The Liberal Democrats are not proposing to change this at all.

    Every Disabled Child Matters, Macmillan and Disability Now magazine among others have highlighted the fact that disabled people and people with terminal illnesses struggle with fuel bills.

  • Anthony Aloysius St 23rd Mar '10 - 5:44pm

    “Incidentally, the £100 a year that pensioners will save from the increase in the tax-free allowance will also go a little way to compensating for the loss of £125-400 of winter fuel payement for the 60-65 year-olds.”

    Actually, it looks to me as though only those over 80 get £400, and that the maximum anyone could lose would be £250. The trouble is that those currently getting £250 include people on various benefits – many of whom may not be pensioners, and so wouldn’t benefit from the income tax changes. So no doubt quite a lot of poor people would be quite badly hit by this change.

  • Peter, I didn’t apply for Winter Fuel Benefit and I’m not in any of the categories you list, but I got it sent to me anyway when I reached 60. I’m not sure what system apart from invidious means testing would exclude people like myself who is working full time and in truth does not need £250 from the government at this point in my life, but I figure that as they sent it to me anyway and I’ve paid a huge amount of tax in my life I might as well have it. If LibDem cuts take the benefit away from people like me that’s fine: if people who are in genuine need suffer then it isn’t.

  • The ‘Cold Comfort’ report fiound that £2.2 billion of the £2.7 billion paid in Winter Fuel Payments is going to households who are not in fuel poverty. 100,000 pensioner households who receive WFP have an income over £100,000. Meanwhile a full 49% of the ‘fuel poor’ receive no WFP.

  • I’m 60 years old and self employed. If I don’t work I have no income. My health isn’t as good as it could be and the Winter Fuel Payment is a little boost that helps in an ‘every penny counts’ situation. You tinker with that payment at the cost of mine and my wife’s vote. Tax the bankers – they started this mess!

  • Im not sure whats going on is the winter fuel being stopped for 60 onwards or is going to stay the same for next 10years then change im confussed also whats happening wth state pension is thats safe without these people would be so much poverty and how can the pensioners keep warm in the winter,can anyone tell whats going on and explain it to me .Thank you

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