Rachel Reeves is to scrap winter fuel payments for 10 million pensioners and ditch a cap on social care costs to fund a public sector wage rise, it has been announced. The Telegraph has more.
The Chancellor’s decision leaves millions of retirees worse-off and means tens of thousands of elderly Britons now face the prospect of selling their homes to foot their care bills.
It came as Ms. Reeves announced she would make £5.5bn in savings this year as she claimed the Tories had left a £22bn hole in the public finances.
The bulk of this includes a £9.4bn pay settlement that will be made to public sector workers this year.
However, this does not include a 22% settlement for junior doctors announced on Monday.
Planned savings include restricting winter fuel payments to people already claiming means-tested benefits.
In a major departure from previous Labour manifesto pledges, Ms. Reeves said it was “fair and right” to withhold the payment from millions of pensioners.
Labour had called for payments to be restricted in 2015, when Ed Miliband was leader and Ms. Reeves was Shadow Work and Pensions Secretary. However, Jeremy Corbyn pledged to keep it.
Last month, a Labour spokesman insisted the party had “no plans” to change the policy.
Scrapping the payments means almost 10m pensioners are set to lose out for the first time. Ms. Reeves will also order departments to make in-year savings.
Currently, all 11.4m pensioners receive an extra £200 to help heat their homes every winter, with people aged over 80 receiving a blanket £300 payment.
Ms. Reeves also opened the door to billions of pounds of additional tax rises this autumn when she delivers her maiden Budget on October 30th. She hinted that pensioners could face more pain. …
Ms. Reeves’ move is expected to hit the majority of pensioners and save £1.4bn this year and £1.5bn next year. It means only 1.5m households will receive the payments going forward.
She also announced Labour would ditch social care reforms recommended by economist Sir Andrew Dilnot more than a decade ago.
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