Starmer and the Winter Fuel Payment

Sir Keir Starmer appears to be neither economically nor politically astute.

Economics: the vote only just passed to abolish the Winter Fuel Payment except to those on Pension Credit may end up as a net cost to the Treasury. John Redwood tweeted beforehand ‘Removing the fuel allowance from many low income pensioners will boost numbers on Pensioner Credit,’ and Starmer has committed to helping more pensioners claim PC anyway. Besides, as Rebecca Paul MP noted in Prime Minister’s Questions last week, ‘those just above the pension credit threshold… will be hardest hit;’ one pound below, you get the allowance and one pound above, you don’t; it’s a can of worms.

Party politics: Quentin Letts’ Parliamentary sketch in the Daily Mail today says ‘Labour’s newbies sat in pools of hand-wringing worry,’ as well they might, bearing in mind that the Winter Fuel Payment was an initiative of Tony Blair’s inaugural term in power. Gordon Brown’s pre-Budget speech announced it (25.11.1997) together with a cut in VAT on fuel. Yesterday Labour won the division 348:228 but seven Government ministers abstained and one Labour MP, Jon Trickett, dared to vote no, despite what Letts perceives as stern Party whipping generally. The PM can scarcely afford to show weakness so early in his premiership, yet a tree that does not bend may snap; he and his Chancellor have chosen an issue where there is no win for them.

Yet the complexities of State pensions could be presented as a magnificent historical achievement. There was a time when so many feared old age and its miserable poverty, with the shadows of the workhouse or infirmary hanging over them; no more.

Another part of our Welfare State’s achievement is to have helped people live longer. In 1974 when Harold Wilson’s Labour government began to link State pension increases to average earnings, there were an estimated 2.3 million men aged 65 and over, and 4.2 million women over 60 (the respective qualifying ages for SP at the time.) Last year those in receipt of a State Pension numbered about 12.6 million, despite recent increases in the qualifying ages, especially for women; the cohort of oldie beneficiaries has doubled. Certainly there are challenges but we must remember to celebrate this success.

Sir Keir and his team lack the wit to persuade rather than simply to command.

Published at the Bruges Group blog.