Starmer and Farage have doomed Britain to a spiral of decline

Telegraph

21 hours ago

The Government's decision to U-turn on the winter fuel allowance is absurd – and, sadly, a big indicator that Reform UK is not going to be the party which breaks Britain out of its spiral of self-inflicted decline.
Rachel Reeves plans to restore the WFA to all pensioners with an income up to £35,000 a year. It will then be clawed back from the wealthiest retirees via the tax system. Overall, around 7.5 million older people who missed the payment last year are set to receive it again – at an apparent cost in the region of £1.25 billion a year.
Paul Johnson, the Chair of the Institute for Fiscal Studies, puts it well: 'It wouldn't even be in the top 100 of things that I would do with my £1.25bn if I wanted to act on poverty. Almost none of the people impacted by this will be in poverty.'
He's right. The Government's decision to means test the WFA removed the payment from some ten million people; of these, its own analysis suggested that only 50,000 or so were placed into 'relative fuel poverty'. And remember, 'relative poverty' is merely an income inequality metric; it doesn't mean someone is necessarily unable to afford heating.
Even on the face of it, therefore, Reeves is hosing money at 7.5 million people for the sake of lifting just 50,000 out of 'relative' poverty. But closer consideration of the numbers reveals even deeper absurdities.
Take the income requirement of £35,000. From the off, that is only a couple of grand less than the national average wage of £37,430. Why should pensioners on that income receive a fuel payment when working-age people on similar incomes do not?
If anything, those working-age people are more deserving of help – for their cost of living is often substantially increased by costs from which many pensioners are exempt. How many of those 7.5 million beneficiaries, for example, are living mortgage-free?
Retirees are also exempt from National Insurance, and that has big implications for their real income. Without NICs, that £35,000 becomes about £2,500 a month post-tax; for a working person to be in a similar position, they would need to earn quite a bit more than the average wage (enough to be in the top 37 per cent of earners, or thereabouts).
Pensioner poverty was a real problem in 2010, when the Coalition Government first introduced the Triple Lock. But whilst there are some struggling pensioners today, it is absurd that the State continues giving indiscriminate welfare to what has become, on average, this country's wealthiest age cohort.
Our pathological inability to cut entitlement spending, even to people who obviously don't need it, is one of the main reasons our country is in such a sorry state.
We are all but conducting a controlled experiment in how much of the state can be all but dismantled – prisons, courts, the military – in order to avoid touching the big revenue expenditure accounts.
Arresting British decline will require breaking out of this cycle. But it's a prisoner's dilemma for politicians: try to do the right thing, as Theresa May did on social care, and it creates an all-too-tempting opening for opportunistic opponents to exploit – as Labour did then, and as Reform UK has done now.
Now forced to govern in the long shadow of wildly unrealistic voter expectations, Labour is probably quietly regretting its game-playing over the 'dementia tax'. If Nigel Farage ever becomes prime minister, and is forced to admit the extravagant savings he claims he can get from abolishing DEI and net zero are for the birds, he may well regret killing off such an obvious cut as the winter fuel allowance.