Rachel Reeves confirms Winter Fuel U-turn – but backs fiscal rules
The Chancellor is under mounting pressure to relax the self-imposed spending restrictions, including from the International Monetary Fund which predicted they will result in emergency cuts.
But Reeves said on Tuesday that her rules were 'non-negotiable', claiming that ditching them would risk economic chaos.
She did however confirm that the Government was seeking to allow more pensioners access to Winter Fuel Payments – amid growing dismay among Labour ranks over the politically toxic fallout from the cut.
An extra £300 billion will be available for public spending in the coming years, Reeves claimed, because of her tax hikes and changes to the way borrowing is accounted.
She said: 'Not every department will get everything that they want next week and I have had to say no to things that I want to do too.'
(Image: PA)
But, Reeves (above) added: 'That's not because of my fiscal rules. It is a result of 14 years of Conservative maltreatment of our public services, our public realm and of our economy.'
The Chancellor denied she would be forced into further tax increase to meet her fiscal rules, which include a promise to match day-to-day spending with revenues.
She said: 'We made decisions in the budget last year to increase taxes by £40 billion.
READ MORE: Labour minister in 'jaw-dropping' U-turn on Glasgow drug consumption room
'We have absolutely no intention of repeating a budget on that scale again.'
There are growing worries in England that cuts to the policing budget will result in forces having to further pick and choose which crimes are investigated, but Reeves dismissed concerns raised by the head of the Metropolitan Police.
On Winter Fuel Payments, the Chancellor said: 'People should be in no doubt that the means test will increase and more people will get winter fuel payment this winter.'
(Image: BBC)
Meanwhile, pensions minister Torsten Bell (above) told MPs that, while more pensioners will be eligible, there is no prospect of returning to universal winter fuel payments.
Speaking to the Work and Pensions Committee, Bell said: 'Directly on your question of is there any prospect of a universal winter fuel payment, the answer is no, the principle I think most people, 95% of people, agree, that it's not a good idea that we have a system paying a few hundreds of pounds to millionaires, and so we're not going to be continuing with that.
'But we will be looking at making more pensioners eligible.'
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