‘Millionaire' pensioners will not get winter fuel payments

Telegraph

2 days ago

'Millionaires' will not be eligible for winter fuel payments this year even after the Prime Minister's about-turn on cuts to the scheme, the pensions minister has told MPs.
Torsten Bell said there will be no return to the system under which all pensioners were given as much as £300 per year to help cover the cost of heating in the cold months.
'Is there any prospect of a universal winter fuel payment? The answer is no,' he told the Commons work and pensions committee.
'Most people – 95pc of people – agree that it is not a good idea that we have a system paying a few hundred pounds to millionaires. But we will be looking at making more pensioners eligible.'
Rachel Reeves, the Chancellor, sparked a backlash last summer when she announced restrictions on payments shortly after Labour won the general election.
The party had not made any reference to the idea in its manifesto or election campaign, but the policy was cited as evidence Labour was serious about reining in excessive public borrowing.
Mr Bell declined to set out the exact terms of the loosened means test which will replace the current system, under which pensioners only receive the winter fuel payments if they also claim pension credit.
He also said that income, not just wealth, could form a part of the qualifying criteria.
'We are committed to the principle that there should be some means testing, and that those on the highest incomes shouldn't be receiving winter fuel payments,' he said.
'Fairness is an important part of it. My priority is those who are on lower incomes but have missed out.'
More than a fifth of all households aged over 65 have assets worth £1m or more, according to the Office for National Statistics, including their homes, pensions and other wealth.
Mr Bell's comments indicate that, if millionaire status is the qualifying criteria, more than 2.5m pensioner households stand to miss out on the restoration of winter fuel payments as a result.
Baroness Altmann, who served as a pensions minister under the Conservatives, said this would risk penalising those who are well off on paper but have little cash to cover energy bills.
She said: 'Very often people are asset rich and income poor. Just because you live in a house worth £1m in London, which you might have bought for £20,000, does not mean you have got plenty of money to spend. You can still be on a very low income.
'If you have big expenses for a house, if your house is not very well insulated, and especially if you are poorer and have not been able to spend a lot of money on updating, then they will need more money for heating than younger families.'
She favours offering winter fuel payments to all pensioners whose income is below the higher rate tax threshold of £50,271 per year.
'The most logical decision would be to treat it like child benefit, and if you pay higher rate tax then you do not get it,' Baroness Altmann said.
'If you pay higher rate tax, the Inland Revenue knows, so could adjust your tax code or find some other way to make sure you do not get the money.'
It came as Ms Reeves confirmed that the new arrangements will be in place to give the payments to more pensioners this winter than last.
'People should be in no doubt that the means test will increase and more people will get winter fuel payment this winter,' the Chancellor said.