Nobody other than in the occasional debate or think tank gave a thought to this issue for 28 years until Reeves opened the worm can.
£200 or £300 would drop quietly into the household bank account(s) around November time and we thought “that will help towards the gas bill or a few Christmas treats” - both of which would incur taxes.
And now it’s a hot button topic where anyone with income of more than £35,000 is deemed a pariah and people like journalist Lewis Goodall are having a wonderful time stirring up intergenerational warfare.
As I wrote upthread, someone with an income of £35,000 and an average house is already paying in the region of £7,000 of that back in income tax and council tax.
To have an net income of £28,000 after 50 years of work, paying into occupational pension schemes and NIC isn’t a huge amount when www.retirementlivingstandards.org.uk/ is saying a single person needs to spend over £31,000 a year to have a moderately comfortable retirement.
In a report on Fuel Poverty in March 2010, the House of Commons Energy and Climate Change Committee concluded that, as a means of tackling fuel poverty, the Winter Fuel Payment was unfocused and poorly-targeted.
As a means of tackling fuel poverty, the case for Winter Fuel Payments is weak. Its payment is unfocused and not targeted on people in or near fuel poverty. However, as a universal means of supplementing pensioner incomes, which is easily understood and easy to pay, the political case for the retention of Winter Fuel Payments is strong. _However, it would be more intellectually honest to rename the benefit; concede that it a general income supplement_; and stop accounting for it as a fuel poverty measure.
The Labour Government did not respond before the 2010 General Election, but in its response published on 25 October 2010 the new Government stated, in relation to the Committee’s recommendation:
We accept that the Winter Fuel Payment is not solely a fuel poverty measure - it also provides reassurance to older people that they can afford to keep warm in the winter months when heating bills are higher. Each winter the Winter Fuel Payment helps over 12.3 million older people in around 9 million households with fuel bills, at a cost of around *£2.7 billion. We therefore think that "Winter Fuel Payment" is an appropriate name for this benefit and there are no plans to change it.
* it is now less than that, around 1.8 billion since the equalisation of the SP age for men and women.
Would that they had changed the name, then it might now be accepted for what it really is, a general supplement to what is arguably the lowest State Pension in Europe.