Pensioners are horrified to discover that most of them are set to lose their winter fuel allowance. Perhaps they should have seen it coming. Governments can only spend what they collect from taxpayers. Given that Labour promised not to increase taxes, the Government has to fund its spending decisions by cuts from elsewhere. So the winter fuel allowance will be removed from all but the poorest pensioners.
It is to be expected that Rachel Reeves is taking the unpopular decisions now. Labour’s majority means she has the votes in Parliament to do exactly as she likes. No one is listening the Conservative Party at the moment. This Government will not be facing the electorate for at least four years. There will be time enough to bribe the electorate with their own money through some well chosen tax cuts.
The Chancellor claims that she is forced to do this because she has the worst economic inheritance since the Second World War. Well that couldn’t have been a surprise to her. If you shut down the economy for two years and spend £400bn fighting COVID, there is obviously going to be a big impact on the nation’s finances. The cost of fighting the pandemic is akin to a war debt. I can’t understand why the last Government failed to say so. And it might have added that Labour were in the lobby with them every step of the way. Instead Conservatives fed the narrative that the 2022 mini budget crashed the economy. £30bn tax cuts is small beer compared to the borrowing which Boris Johnson’s Government took on. It was a tactical mistake by the Conservatives to allow Liz Truss to be scapegoat for the economic ills of the last Government. In doing so they trashed their own brand and created the conditions for their spectacular defeat.
But I digress. What does the removal of the winter fuel payment tell you about the attitude of this Government towards the nation’s pensioners? Much has been made of the fact that the Conservative Party polls better amongst pensioners than working age adults. And there is a question of fairness when working people are funding through their taxes an allowance that goes to every pensioner regardless of income. But restricting winter fuel allowance to only those in receipt of pension credit? That is one harsh decision. It is reminiscent of Gordon Brown’s 75p pension rise.
I think we can infer that pensioners wont be at the front of the queue for giveaways from the Chancellor. But neither will children, despite Labour’s stated aim to eradicate child poverty. The two child benefit cap will remain to the dismay of many Labour MPs.
Ultimately if Rachel Reeves wished to alter any of these decisions she would have to make cuts elsewhere. It is difficult to see where else to make cuts. MOJ and local government have born the brunt of cuts in previous years with the result that councils are being bankrupted by the escalating cost of social care and our prisons are more than full.
It should not come as a surprise then that low hanging fruit in the benefits budget is targeted. But it tells you a lot about what this Government is going to be and whose side it is on.
The clue is in the name. Labour. The Labour Party was born in the trade union movement as a means of advancing the cause of the workers. It is entirely on brand that the Party’s first act on entering Government was settling the public sector pay disputes. This is a Government that will always be on the side of public sector workers.
So it falls to the nation’s pensioners to pick up the tab for hefty pay awards to end the strikes. This Government has picked a side and it isn’t the side of pensioners. Don’t forget it.