close
close

Apre-salomemanzo

Breaking: Beyond Headlines!

Money blog: The massive winter fuel payment ‘cut’ that no one ever talks about | Money News
aecifo

Money blog: The massive winter fuel payment ‘cut’ that no one ever talks about | Money News

By Jimmy Riceeditor of the Money blog, and Daniel Dunfordsenior data journalist

Anger over Labor’s scrapping of the universal winter fuel payment earlier this year has been widely publicized – but a less-publicized cut to the benefit has taken place every year since 2000.

Around 1.3 million people in England and Wales who are entitled to some means-tested benefits can receive £200 or £300, up from more than 11 million.

These amounts have not changed in more than two decades, despite periods of dizzying inflation and an exponential rise in energy prices in recent years.

Sky News analysis shows the £200 available to 60 to 79-year-olds would be worth £370 today if it had increased in line with inflation.

If it had risen in line with energy prices, it would now be worth almost £1,000 and would have paid more than £1,200 at the height of the energy price crisis in winter 2022-23.

The payment for over-80s was increased to £300 in April 2003. If this amount had increased since then with inflation, it would be worth more than £500 today.

If it had risen at the same rate as energy prices, it would be worth more than £1,200 today and would have exceeded £2,000 in 2022-23.

This significant annual reduction in real terms has coincided, over the past 13 years, with an increase in pensions in real terms due to the triple lock – potentially offsetting some of the consequences of the payment freeze.

But charities who spoke to Money say vulnerable pensioners are suffering from payment stagnation.

Caroline Abrahams, charity director of Age UK, said: “Energy prices are much higher than they were a few years ago, and yet the winter fuel payment, designed to help retirees to face these costs, remained the same.

“More recently, of course, the current government has decided to brutally ration access to payment, with the main condition now being that you get pension credit.

“The lack of commitment from governments of all colors to paying for winter fuel arguably reflects a lack of understanding in Whitehall of the difficulties older people on low and modest incomes face in earning money to cover basic needs, especially during the colder months when they need to stay warm to protect their health.

Disability Rights UK highlighted a report this week an estimated 10,400 terminally ill people die in poverty each year.

It is therefore “surprising”, says the association, that the winter fuel payment has not been increased for decades.

Dan White, head of policy and campaigns, said: “Energy bills are rising, energy companies are making huge profits, poverty is increasing, so there is plenty of evidence that the current winter fuel payment is disconnected from the financial reality of life for disabled retirees.

“An increase is not only justified, it is imperative, and we need a social energy tariff targeted at those facing high energy costs, including disabled people and the elderly. If the government does not act accordingly, a humanitarian crisis will be upon us. “

We asked the government if it would consider increasing fuel payments in winter. The Department for Work and Pensions told us:

“We are committed to supporting pensioners – millions of people are set to see their state pension increase by up to £1,700 this Parliament thanks to our commitment to the triple lock.

“More than a million retirees will continue to receive winter fuel payments, and our efforts to boost the use of retirement credits have already led to a 152% increase in applications.

“Many others will also benefit from the £150 Warm Home Discount to help pay their energy bills over winter, while our extension of the Household Support Fund will help cover the cost of food , heating and bills.”