How ‘Distraught’ Labour MPs Plan To Punish Rachel Reeves Over Winter Fuel Payment Cuts
On May 1, Keir Starmer could not have been clearer about his position on whether or not every pensioner should continue to receive the winter fuel payment from the government.
Scrapping it, the then leader of the opposition made clear to the House of Commons, was a very bad thing.
So concerned was he at the prospect of the Tories doing it, he asked Rishi Sunak at PMQs that day: “Will the prime minister now rule out taking pensioners’ winter fuel payments off them to help fund his £46 billion black hole?”
How PM Starmer must now regret that particular line of attack.
Within days of entering government two months ago, chancellor Rachel Reeves decided to means test the hitherto universal benefit, meaning only those on pension credit would continue to receive it, with 10 million OAPs missing out.
Reeves blamed the £22 billion “black hole” in the nation’s finances – that Labour insist they inherited from the Tories – for the need to find savings where they can in order to balance the books.
Nevertheless, it has created a huge political problem for the new government which could result in Starmer suffering his largest backbench rebellion yet.
Under mounting pressure from MPs, Commons leader Lucy Powell announced that a parliamentary vote on the controversial cut will take place on Tuesday.
That is the same Lucy Powell who was sent out onto the airwaves last weekend to suggest that had the Chancellor not take the decision she had, there would have been a run on the pound and the economy would have crashed.
Some in government are baffled that Reeves has chosen to take up to £300 off millions of OAPs – many of them on incomes of barely £11,500 a year – the first signature decision of her time in office.
One senior source told HuffPost UK: “I keep waiting for some sensible person to say ‘right, how do we get out of this hole we’re fallen into on this policy’ as opposed to, for some reason, making it a test of our political and economic credibility.”
Another insider said: “This is a problem on the doorstep, but they have to see it through now.”
So far, 10 Labour MPs have signed a Commons motion calling on the Treasury to think again, but some senior party figures believe as many as 20 could end up rebelling.
That would easily beat the seven rebels who defied the PM and voted to scrap the two-child benefit cap barely a fortnight after the general election – and were stripped of the Labour whip for their trouble.
HuffPost UK understands there are currently no plans to impose the same sanction on any MPs who vote against the government on Tuesday.
Among the signatories to the rebel motion tabled by Labour MP Neil Duncan-Jordan is former shadow cabinet member Rachael Maskell, who told HuffPost UK she and her Labour colleagues were “deeply concerned” at the government’s approach.
“I’ve spoken to so many MPs who are really distraught about these measures,” she said. “Some have literally been in tears at the prospects of their elderly constituents not getting their winter fuel payments.
“I’ve read letters myself and been in tears. One recently widowed constituent told me they are just above the income threshold so they no longer qualify for the payment and are really fearful for the winter. This isn’t about macro-economics, this is about real lives.”
The Treasury has launched a campaign urging the 800,000 pensioners who qualify for pension credit but don’t claim it, to do so.
But Maskell said that even once you have completed the lengthy application form, it takes nine weeks to process the claim.
“To keep old people warm and well they need to have enough money to pay the bills and this needs to be the focus now,” she said. “We have said we will protect the NHS, so we don’t need more old people in hospital beds this winter.
“Old people can’t retain heat, putting them at greater risk of stroke, heart attack and hypothermia. That would put a greater demand on the NHS, and It will be [health secretary] Wes Streeting who will have to stand before the country and explain why – and I don’t want him to have to do that.”
The York Central MP wants the chancellor to delay her plans to cut the winter fuel payment until next year, and use that time to establish a better system for targeting the benefit at those who need it.
Caroline Abrahams, charity director at Age UK, said, “many older people are very frightened about how they will manage this winter” when the payment is removed.
The charity estimates that around one million old people living near the poverty line, but who are not poor enough to receive pension credit, will “really struggle” this winter as a result of the chancellor’s decision.
Abrahams said: “The government is not disputing that millions of pensioners on low and modest incomes will lose their winter fuel payment under their plans and they have no credible answer when asked about the plight of all those whose tiny occupational pensions take them above the pension credit line.
“It is for these reasons that they should pause this policy so it can be fully considered as part of the government spending review in the spring.”
Downing Street sources have told HuffPost UK that the government has no plans to U-turn, or offer any concessions to the rebels, ahead of Tuesday’s vote.
They pointed to the extra £421 million which was announced last week for the household support fund, and the fact that the pensions triple lock means the state pension will increase by £400 each year as proof that the government is acting to help those on the lowest incomes.
A cabinet minister defended the government’s position, and insisted that the chancellor had actually chosen the least worst option.
“We know it’s difficult but we can see how bad the public finances are,” they told HuffPost UK. ”It was pretty clear that there was going to be a major economic shock in the markets had we not taken immediate action on this.
“The choice the Treasury had was to either keep the pension triple lock or means test the winter fuel allowance. That makes it quite an easy choice.
“The politics are tough, but we have to show voters that we’ve been left with this dreadful inheritance and that’s the real difficulty we’ve got. There are no palatable choices here.
“We’re asking the public and the pensioners to give us a bit of time to sort this mess out.”
Nevertheless, Tuesday’s vote promises to be extremely uncomfortable for Starmer and Reeves.
And with a brutal Budget coming at the end of October, the PM seems certain to make good on his promise that “things will get worse before they get better”.