In July, Labour announced that the Winter Fuel Payments (WFPs) which have been made to almost all pensioner households every winter since their introduction in 1997, will now only be available to pensioners in receipt of means tested benefits or pension credit. This decision which has been met with outrage from charities and campaigners will mean up to 7 million families losing the payment, including 1.6 million Disabled pensioners.
The new report titled Cold comfort; Mitigating the Winter Fuel Payment cut, focuses on what can be done to help pensioners, suggesting the mitigations should be put in place this winter to soften the impact of the cut. Viable options of support should meet two criteria: the ability to be targeted at both income and energy needs and allowing the Government to retain a large portion of the pencilled-in saving from the Winter Fuel Payment restriction.
The report notes that an energy social tariff would be the ideal solution to help those affected but that isn’t feasible for the imminent winter as if it would take a long time to design and implement.
The four alternatives of support explored by the foundation include:
- Reducing bills directly through reforms in energy policy – which can be scaled by energy use but cannot target based on incomes.
- Cutting costs for families on pre-payment meters – this would largely benefit poorer families, but a relatively small number of them compared to other options.
- An expansion of the Warm Home Discount scheme – which enables greater support to be channelled to poorer benefit-receiving families but does little to help those who have lost the Winter Fuel Payment.
- A substantial expansion of the Cold Weather Payments scheme – perhaps the most promising avenue, in that it can target based on reasonable proxies for income and energy need and could replicate a cut-price version of the universalism lost in the Winter Fuel Payment cut.
The decision to remove the WFP has sparked fierce debate. The Governments line on the policy has been that some pensioners in receipt of the payment are very wealthy and therefore should be eligible to receive it. However, others including Disability Rights UK point out that vulnerable and Disabled pensioners – who don’t claim or even qualify for Pension Credit – are set to lose much-needed support this winter, noting the possible increase of excess winter deaths.
The Resolution Foundation, in the conclusion of the report said “Looking further ahead, the Government can – and should – seek to give itself better options for future years, for which we have more time to prepare. Investment in energy efficiency will also be vital to control costs both for families and for the Government, particularly as older households are currently more likely to live in energy inefficient homes. More particularly in relation to fuel poverty, ministers should move towards the establishment of a government-run social tariff, through which incomes and energy needs can be taken into account directly. This will allow for the channelling of support that is both targeted and scaled, and not reliant on such imperfect proxies as benefit receipt and the certified energy efficiency of a home.”
Dan White policy and campaigns officer and one of the leads at the Disability Poverty Campaign Group said “This report, painstakingly put together, not only points out the catastrophes of this terrible policy decision, but also gives, with clear-headed clarity, options of softening the blow for many nervous pensioners this winter.”
“We know that analysis shows that although Disabled people may be more likely to retain the payment, 71% - or 1.6 million - would still lose their entitlement, despite their often-greater dependence on heating their homes which is morally wrong.”
“Although we welcome the ideas within the report, we will continue our work on pushing for an energy social tariff, and the reinstatement of the WFP, especially when all other cost of living support payments have ended.”
The Resolution Foundation report Cold Comfort is available from www.resolutionfoundation.org.
For advice on keeping warm this winter please visit the Age Uk website.
For more information on the cuts to the Winter Fuel Payment visit the Which website