A senior government minister has declared that millionaires should not receive winter fuel payments, as the government reviews adjustments to the pensioner allowance. Treasury Chief Secretary Darren Jones stated that payments will be “targeted to those most in need.”
This follows Prime Minister Sir Keir Starmer’s reversal on the allowance withdrawal for millions of pensioners, after significant public backlash. Sir Keir announced that “more pensioners” will regain eligibility, with details to be revealed in the autumn Budget.
However, the Prime Minister offered no specifics on the number of beneficiaries, the implementation date, or the financial implications. Conservative leader Kemi Badenoch echoed this sentiment, stating that millionaire pensioners shouldn’t qualify.
Conversely, Reform UK, the Liberal Democrats, and the Green Party advocate for the full restoration of the winter fuel allowance. Over 10 million pensioners lost payments of up to £300 last year after eligibility was restricted to those receiving pension credit and similar income-related benefits. Learn more about pension credit here.
When questioned on Sky News about clarifying the changes, Jones emphasized the need for “orderly” implementation. He reiterated the government’s stance against subsidizing millionaire energy bills, confirming that winter fuel payments will remain targeted. While he did not define “millionaire,” he indicated an eligibility threshold review in the coming months.
The winter fuel payment provides £200 annually for households with pensioners under 80, and £300 for those over 80. Previously, all eligible pensioners received it regardless of income. The Labour government’s changes last year affected 10.3 million pensioners, saving an estimated £1.4bn, a move justified by the need to address a budget deficit.
Recent pressure to reverse course has intensified, partly attributed to the party’s local election losses. The Institute for Fiscal Studies (IFS) has proposed various expansion options. The current pension credit income threshold is £11,800 annually for individuals and £18,023 for couples. The IFS cautions that a means-test would create administrative burdens and deter claimants. The Resolution Foundation shares these concerns, estimating a 10% pension credit expansion could cost £2.5bn, exceeding the original savings target.