Former minister calls for end to winter fuel payments
Axe winter fuel payments and free TV licences for well-off pensioners. The call has been made before, but this time though it's from Baron John Patten.
Many British pensioners are entitled to £300 a year in winter fuel allowances, plus a free TV licence and free transport. But do wealthy OAPs really need all these benefits?
Winter fuel payments, for example, cost the Government around £2bn a year. Anyone born before July 1951 receives it. Yet it's thought the taxpayer could be saved around £250m a year removing this benefit from those with an income of more than £35,000.
It's a tricky issue for the Government because many pensioners vote (and they're increasing in numbers). Yet at a time when welfare benefits are being hacked back and thousands can't afford to buy their first home because of silly property prices, such universal benefits can seem over-generous to a particular demographic - the old.
Celebrity supportCalls for better off people to return the benefit have been backed by numerous celebrities, including Helen Mirren, as well as other politicians like Ann Widdecombe. The director-general of Saga, Ros Altmann also endorses the idea.
Altmann says she wants all OAPs who feel they can do without these universal benefits to return this cash to pensioners struggling with higher energy bills. Last year it's estimated more than 25,000 Britons died from the cold. Heart attacks, respiratory failure, strokes. Saga says their campaign raised £2 million last year supported by 20,000 better-off OAPs.
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But there also other ideas to save money. For example, scrapping the annual higher tax rate relief on pensions would save, it's thought, the Government around £7bn a year. That would pay for annual universal winter fuel payments three times over, with a £1bn in change.
Such a move would horrify the pensions industry. But at a time of austerity, is it right that the well-off are still entitled to 40% tax relief on pension contributions of up to £50,000, year in, year out? If scrapping it completely is a move too far, lowering the threshold dramatically is certainly a move whose time has come.