Means-testing pensioners for benefits moves a step closer
Pensioners could face the prospect of losing their automatic winter fuel allowances, free bus passes and free TV licences after the next election, it emerged last night.
Speculation about whether benefits enjoyed by millions of pensioners – irrespective of their wealth – would continue indefinitely intensified amid debate about further Government spending cuts.
The Prime Minister’s official spokesman said universal benefits for pensioners are to be protected for the financial year 2015-16, but offered no guarantees beyond that.
The statement effectively extends David Cameron’s pledge not to cut the benefits during this Parliament for a further 11 months to April 2016.
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With Chancellor George Osborne seeking an additional £10 billion in savings as he negotiates spending settlements for 2015/16, Mr Cameron had been coming under intense pressure to means-test benefits such as the winter fuel allowance and free TV licences, bus passes, eye tests and prescriptions for pensioners, to save money for other priorities.
There was speculation yesterday that some kind of earlier cut might be under consideration, after a Downing Street spokeswoman said that the payments were only protected until the general election scheduled for May 7 2015 – around a month after the start of the financial year.
But the PM’s official spokesman told reporters: “As regards pensioner benefits, the Prime Minister has very clearly set out his promises on this. He stands fully behind them.
“Pensioner benefits are fully protected for the entirety of this Parliament – including for the year 2015/16.”
With health, schools and overseas aid already protected from reductions in the spending review, the move to put pensioner benefits off-limits in the shorter term restricts even further Mr Osborne’s room for manoeuvre when looking for cuts in departmental spending.
He is thought to be coming under intense pressure to demand that the bulk of the savings come from the welfare bill, in order to avoid further cuts to areas like defence, criminal justice, the police, local government and transport. Mr Cameron’s pledge to preserve pensioners’ benefits was first made during the 2010 general election campaign and confirmed in the 2010 Coalition Agreement, which sets out the Government’s policy framework to the end of this Parliament. But some Cabinet minister are thought to believe that the payments should be means-tested to save money, and Deputy Prime Minister Nick Clegg has publicly suggested that wealthier pensioners can afford to “sacrifice” some of their benefits.
Mr Cameron made clear last month he intended to keep his word, saying: “I made a very clear promise at the election that we would keep the winter fuel payments alongside the other pensioner benefits as they were, and that’s a promise I’m keeping.”
Mr Osborne is due to announce spending settlements for 2015/16 by the end of June 2013.