“This fight is also about the very future of our Welfare State and re-asserting the principle of universalism.”
By John McDonnell MP
In what has turned out to be a massively unpopular cut, on 29 July the Chancellor announced – at incredibly short notice – that the Winter Fuel Payment will now only be available to those receiving pension credit or other means-tested benefits.
Numerous pensioners groups, campaigners, charities, trade unions, experts and others have outlined in great depth the social and economic harm this cut will inflict on the country, its pensioners and public services. These include, but are not limited to:
- Estimates that this measure will drive two million people into fuel poverty.
- Unite the Union showing that millions of pensioners will lose up to £300 a year, which is equivalent to losing more than a week’s pension income.
- The identifying by Age UK of three key groups that will be particularly effected – namely pensioners on low incomes who will just miss out; disabled people and people who are unwell with high energy use; and those who do not claim pension credit despite being entitled.
- The likelihood that – as outlined in a letter from the Women’s Budget Group, Age UK, Carers UK, End Fuel Poverty coalition – “cutting the incomes of older people struggling to make ends meet will inevitably put further strain on the NHS and social care system as more people are unable to heat their homes and eat fresh food.”
As Age UK put it, in summary, “means-testing the Winter Fuel Payment, with no notice and no compensatory measures to protect poor and vulnerable pensioners, is the wrong policy choice, and one that will potentially jeopardise the health as well as the finances of millions of older people this winter – the last thing either they or the NHS needs.”
The context to this cut is that energy costs remain high and are increasing, whilst other support continues to be reduced after more than 14 years of ideologically-driven austerity, with older people bearing the brunt of the energy price rise which happened last week on October 1, and energy costs now at 65% higher than in 2021.
And at the same time, Ofgem is allowing a margin of 11% profit to energy companies already enjoying record levels of profits.
Specifically, the energy price cap, set by industry regulator Ofgem last week for the period from 1st October to 31st December, will see bills for a typical household that uses both electricity and gas and pays by direct debit go up to £1,717 per year. This is 10% up from the previous quarter, with a further 3% hike expected in January.
This is a double whammy for many pensioners – analysis by the End Fuel Poverty Coalition has shown that in real terms the changes in the energy price cap and loss of the universal Winter Fuel Payment means that now millions of older people face their highest energy bills on record.
We should be particularly grateful that groups such as Age UK, the National Pensioners Convention and Unite have been digging deep into what the Winter Fuel Payments cut means, as astonishingly, before the announcement was made, “a full Impact assessment was not prepared for this instrument,” in the words of an Explanatory Memorandum from the Department for Work and Pensions, “because there is no significant new impact on business, charities or voluntary bodies.”
With the recent Labour Party Conference voting to call for a reversal of this cut, we now need to keep the campaign high-up the news agenda, especially with the Budget approaching at the end of October.
To this end on Monday, I was delighted to speak at two events hosted by the National Pensioners’ Convention, as part of a mass lobbying exercise, aimed at making clear to all MPs the deep-level of opposition that exists to this cruel cut, and getting more to understand the wide range of issues arising as a result of the government’s decision.
An outside rally with attendees including Unite General Secretary Sharon Graham, who pledged that retired members and members from across the union will continue to campaign against this cruel policy, was followed by a discussion I hosted in Parliament bringing together policy makers and organisations representing a wide range of people impacted by the winter fuel payment cuts.
To give just a few examples, we heard from Disability Rights UK who are hugely concerned that 1.6 million disabled pensioners are set to lose their Winter Fuel Payment, Fuel Poverty Action who outlined in detail their research on fuel poverty, the inspirational WASPI campaigners on the disproportionate number of older women losing the fuel payment, Medact on the impact on the health and care service as a result of the cuts, and Unite the Union Retired Members who discussed the concerns of today’s workers, who will be tomorrow’s pensioners. Finally, Age UK Director Caroline Abrahams discussed their ongoing campaign against the Winter Fuel Payment cuts and how over a million people have backed their petition.
The battle over this issue very much continues, and the impressive – and growing – alliance being built against this cut can also provide a model for opposing any future austerity measures, as we face the threat of yet more cuts. Furthermore, this fight is also about the very future of our Welfare State and re-asserting the principle of universalism. As Unite the Union have so correctly put it, “a universal payment to all pensioners – just like the state pension itself – ensures nobody falls through the gaps.” The same must be said about the need for universal public services and a welfare state that protect us all.
- John McDonnell is a regular columnist for Labour Outlook. Follow John on Twitter here and Facebook here.
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I was going to give mine to Gaza