Category Archives: Winter Fuel Payments

Changes to pensioner benefits mooted during the general election now appear ‘in limbo’

Pensioners have been left in limbo by the hung parliament election result, with any proposed changes put on hold until a government is formed.

The Conservatives, who were expected to win a solid majority, wanted to scrap the Triple Lock which that the state pension would rise by whichever is the highest of inflation, wage growth or 2.5%, and replace it with a ‘Double Lock’ which would remove the 2.5% annual rise. Under a Conservative government, the state pension age would increase with life expectancy.

They also planned to means-test the Winter Fuel Allowance, which is worth up to £300 a year for older people to help with their heating costs. However, now that the party has failed to win a majority, they may find it difficult to proceed with any of these plans.

Triple Lock and Winter Fuel Allowance

The Conservatives are working towards doing a deal with Democratic Unionist Party (DUP) to form a government, who want to maintain both the Triple Lock and the Winter Fuel Allowance.
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The State Pension is taxed, why not The Winter Fuel Allowance?

We are surprised that subjecting pensioners to new means tests is being suggested for the Winter Fuel Allowance which may require an army of means testers. It would also subject many pensioners to a process that they feel very uncomfortable with. Our suggestion for a long time has been to make WFA subject to taxation in the same way as the State Pension is. We’ve never heard anyone complaining that the very wealthy enjoy the State Pension, so what is the problem with taxing Winter Fuel Allowance? The answer that many may give is that a lot of people will be affected by this, without necessarily being on a massive income. But at least the most needy would get the pension in full, and it would stop the continual bleating about this allowance being paid tax free.

An army of means testers needed ?

An army of means testers needed ?

taxed winter fuel cash to help social care crisis says Baroness

Baroness Altmann has claimed its “ridiculous” that affluent pensioners receive the benefit without a tax penalty – which could help fund social care

AN ex-Pensions Minister is calling for rich pensioners to be taxed on the winter fuel allowance.

Baroness Altmann says it is “ridiculous” they are not — and that the tax penalty could help fund social care.

The Sun on Sunday can reveal just 518 OAPs have declined the payment, which ranges from £100 to £300 and used to help pay heating bills in the winter months, since 2011.

Total government expenditure on it is around £2billion and it is paid to more than 12million pensioners.

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Our comment: this has been a recurring hot chestnut over recent years, but so far governments have not responded. Many people forget that the State Pension is taxed for those with sufficient income. We advocate an increase of 25% in the allowance which is then paid with state pension payments, which will be taxable. That way those that need it will get the full amount, and those on higher incomes will be taxed on it.

PM comes clean on minute cost of pensioner benefits – 0.7% compared to the savings due to raising pension age

Savings on raising state pension age compared to cost of Pensioner benefits

Savings on raising state pension age compared to cost of Pensioner benefits

In his speech yesterday the PM pointed to the comparative savings from raising the state pension age (£500,000,000,000) – the half a trillion he mentioned sounds a lot less – with the cost of retaining pensioner benefits i.e. Bus passes, Winter Fuel Allowance and Free TV Licences for over 75s which is estimated at £3,600,000,000 or 3.6 Billion which represents 0.7% of the state pension age being raised.

And those for those who now have to wait much longer for their state pension the loss of income is massive. Politicians would be wise to realise that those between the age of 60 and 65 are feeling the pain !

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Over-60s should be told to apply for winter fuel payments says “think” tank

Over-60s should be told to apply for winter fuel payments if they need the cash, an influential think tank has recommended.

It reckons better-off pensioners wouldn’t claim, allowing the benefit to be focused only on those households most in need.

The think tank calculates that savings for taxpayers could reach £400m a year, based on research showing that “74pc of people believed winter fuel allowance should only be available to those with incomes or savings below a certain level”.

Under its proposals the payments would continue to go automatically to those receiving pension credit, protecting pensioners on the lowest incomes.

In its Welfare Manifesto, published today, Policy Exchange said: “It would bring the payments in line with other parts of the welfare system, where eligible recipients have to make a conscious choice to receive them. Currently, the majority of these payments are made automatically, meaning that they are passively received.”

Our comment: Our concern would be that the less able/more needy would miss out. Then again Think Tanks don’t do a lot of sensitive thinking do they ?
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The perils of means testing pensioner benefits such as bus passes, winter fuel allowance & free TV Licences

The downside of means testing - beaurocracy gone mad
David Cameron today signalled that he will protect benefits for Britain’s wealthiest pensioners.

The Prime Minister insisted there were not big savings to be made from cutting winter fuel payments, TV licences and bus passes for the well-off.

It raises the prospect of the Tories being the only major party going into the election vowing to preserve the payments for all over-65s, while cutting welfare for people of working age.

“I’ve always said that there aren’t huge savings to be made from axing these benefits and I think pensioners welcome the clarity that there has been.”

Our comment:If he says so we suppose it must be true ?

The Lib Dems blocked any further welfare reform I the current coalition unless Mr Cameron agreed to axe the £2billion in benefits to the better off, including the winter fuel allowance, free bus passes and free TV licences.

Labour has said it will stop winter fuel payments to 600,000 pensioners on higher and top-rate tax.

The Institute for Fiscal Studies has warned taxpayers will have to find another £12billion by the end of the decade to pay for benefits for pensioners.

Shadow chancellor Ed Balls said today: ‘We have said we will have some difficult decisions to get the deficit down.

‘We would reverse the top rate income tax rate cuts which the Tories delivered for people earning over £150,000, but we’ve also said that we would have to take the winter allowance from the richest pensioners, pensioners with pensions over £42,000-a-year.

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pensioners contribute winter fuel allowances to keep bus service

When the 39A service between Hay-on-Wye and Hereford looked set for the chop local businesses and residents offered to fund it and the Hay Ho! bus was born
When penny-pinching local authority bosses scrapped subsidies on a local bus route it threatened to leave pensioners in a Welsh town cut off.

 The launch of Hay Ho! Bus servic

The launch of Hay Ho! Bus servic

So when a group was formed to save the service they stepped in – and handed over their winter fuel allowances to keep the service on the road.

Tourism businesses in Hay-on-Wye, Powys, feared they would lose trade if their public transport link to Hereford on Sundays ended so they decided to shoulder the financial risk themselves.

Facing an estimated £6,000 shortfall for one year of Sunday buses the Hay Tourism Group set up a supporters’ club for the route. It has been named the Hay Ho! bus to make it more appealing than the plain old 39A.

The group has been taken aback not only by the number of people who have already paid the club’s £5 subscription fee but also by pensioners offering winter fuel allowances.

“We’ve had about £1,700 pledged,” said Anna Heywood, secretary of Hay Tourism Group. “We’ve got 29 supporters signed up. Some people have pledged winter fuel allowances.
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