MPs to vote on cutting winter fuel payment for pensioners as Business Secretary Jonathan Reynolds says government has ‘no choice’

Published

1 year ago

September 10, 2024

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The government has “no choice” but to cut winter fuel payments for the majority of pensioners, a minister has said ahead of MPs voting on the controversial plan.

The move – which will see around 10 million people lose the payment of up to £300 to help with energy costs – has been defended by Labour, who said “tough decisions” need to be made in light of the £22bn “black hole” in public finances.

Business secretary Jonathan Reynolds told Sky News: “We have no choice… We’re fixing the foundations [of the economy], and that’s a difficult message today.

“But it’s not just to correct the problem, it’s to make sure your house is better in future and the better future we want, more prosperity for everyone, comes through stability and responsibility.”

However, some MPs from Labour’s own side, as well as charities and opposition MPs, are calling for a U-turn, saying the policy will leave less well-off pensioners with “a heart-breaking choice between heating and eating this winter”.

Ahead of the vote, Prime Minister Sir Keir Starmer will deliver a speech to the Trades Union Congress (TUC) conference in Brighton, where many in the audience will be in vocal opposition to the policy.

He will attack the previous Conservative government for having “salted the earth of Britain’s future to serve themselves”, but appeal for partnership with the unions to fix it, telling them: “The crisis we have inherited means we must go deep into the marrow of our institutions, rewrite the rules of our economy and fix the foundations so we can build a new home.”

Sir Keir will add: “Economic rules written in the ink of partnership will be more durable and long-lasting – whoever is in power. So it is time to turn the page, business and unions, the private and public sector, united by a common cause to rebuild our public services and grow our economy in a new way.

“We will keep to the course of change, reject the snake oil of easy answers, fix the foundations of our economy and build a new Britain. More secure, more prosperous, more dynamic, and fairer. A country renewed and returned, calmly but with confidence, to the service of working people.”

The winter fuel payment was introduced in 1997 by then Labour chancellor Gordon Brown as a universal benefit, with all people above state pension age entitled to it.

However, the current Labour chancellor, Rachel Reeves, now wants the payment to be limited to those entitled to Pension Credit – around 1.5 million people – to save public money.

Making the announcement in July shortly after her party won the general election, Ms Reeves laid the blame at the door of the previous Conservative government, claiming they had made “commitment after commitment without knowing where the money was going to come from”.

While she said the decision to scrap the benefit was “difficult”, it was “necessary and urgent” to fix the money problems that had been left behind.

The prime minister has continued to stand by the move, insisting additional “safeguards” are in place for pensioners already on benefits.

He added: “I am determined that we will take tough decisions because the change which is improved living standards, people feeling better off, better public services, dealing with crime and immigration and issues like that, that change will only happen if we fix the foundations now.”

Further potentially unpopular measures, including possible tax rises, are expected next month when Ms Reeves delivers her first Budget.

But Sky News understands as many as 30 MPs are unhappy with the winter fuel payment cut, though they are likely to abstain on the vote rather than go against the party – especially in light of Labour suspending seven of its MPs in July for six months after they rebelled over keeping the two-child benefit cap.

The general secretary of one of Labour’s major union backers, Unite, also accused the party of “picking the pockets of pensioners”.

Speaking to Sky News from the TUC conference, Sharon Graham said the country was “in crisis” and the new government needed to “make very, very different choices” – including introducing a wealth tax “on the biggest and richest 1% in society”.

The Conservatives are among the opposition parties putting forward their own motions to try and stop the cut – though with Labour’s large majority, the government is likely to win the vote.

Former prime minister and Tory leader Rishi Sunak reiterated his accusation that Sir Keir was choosing to “cut vital support for pensioners to fund an inflation-busting pay rise for train drivers”, calling it “unnecessary and wrong”.

He added: “The last Conservative government always made sure to protect our vulnerable pensioners, because we believe that those who have worked hard all their lives deserve security and peace of mind in retirement.

“But within weeks of coming into power Labour are cutting the winter fuel payments, with potentially devastating consequences.

“Labour MPs know this is indefensible – they must do the right thing and force the government to come clean about the impact this punishing cut will have.”

Also speaking ahead of the vote, Liberal Democrat leader Sir Ed Davey said the government “should do the right thing and change course” as cutting the winter fuel payment would “put untold stress on pensioners, with many facing a heart-breaking choice between heating and eating this winter”.

Confirming his party would vote against the cut, he added: “While we understand the dire state the Conservatives left the public finances in, now is not the time to be cutting support to some of the most vulnerable people in our society.

“We cannot stand by and allow millions of pensioners to endure another winter in a cost of living crisis.”

The SNP’s Westminster leader, Stephen Flynn, also urged Scottish MPs on the Labour benches to follow his party’s lead and vote down the change in policy, saying: “The last UK government hammered the economy, public services and household incomes by imposing 14 years of cuts and Brexit.

“The last thing the UK needs now is more cuts from the Labour Party – and pensioners will face a bitter winter if these cuts go ahead.”

Politics

Chancellor Rachel Reeves refuses to rule out manifesto-breaking tax hikes

Published

3 hours ago

November 4, 2025

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Chancellor Rachel Reeves refuses to rule out manifesto-breaking tax hikes

Rachel Reeves has refused to rule out breaking her manifesto pledge not to raise certain taxes, as she lays the groundwork ahead of the budget later this month.

Asked directly by our political editor Beth Rigby if she stands by her promises not to raise income tax, national insurance or VAT, the chancellor declined to do so.

She told Rigby: “Your viewers can see the challenges that we face, the challenges that are on [sic] a global nature. And they can also see the challenges in the long-term performance of our economy.”

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She went on: “As chancellor, I have to face the world as it is, not the world as I want it to be. And when challenges come our way, the only question is how to respond to them, not whether to respond or not.

“As I respond at the budget on 26 November, my focus will be on getting NHS waiting lists down, getting the cost of living down and also getting the national debt down.”

‘Each of us must do our bit’

Ms Reeves’s comments to Rigby came after a highly unusual pre-budget speech in Downing Street in which she set out the scale of the international and domestic “challenges” facing the government.

She also hinted at tax rises, saying: “If we are to build the future of Britain together, each of us must do our bit for the security of our country and the brightness of its future.”

Despite her promise that last year’s budget – which was the biggest tax-raising fiscal event since 1993 – was a “once in a parliament event,” the chancellor said that in the past year, “the world has thrown even more challenges our way,” pointing to “the continual threat of tariffs” from the United States, inflation that has been “too slow to come down,” “volatile” supply chains leading to higher prices, and the high cost of government borrowing.

She also put the blame squarely on previous Tory governments, accusing them of “years of economic mismanagement” that has “limited our country’s potential,” and said past administrations prioritised “political convenience” over “economic imperative”.

Ms Reeves painted a picture of devastation following the years of austerity in the wake of the financial crisis, “instability and indecision” after that, and then the consequences of what she called “a rushed and ill-conceived Brexit”.

“This isn’t about re-litigating old choices – it’s about being honest with the people, about the consequences that those choices have had,” she said.

‘I don’t expect anyone to be satisfied with growth so far’

The chancellor defended her personal record in office so far, saying interest rates and NHS waiting lists have fallen, while investment in the UK is rising, and added: “Our growth was the fastest in the G7 in the first half of this year. I don’t expect anyone to be satisfied with growth of 1%. I am not, and I know that there is more to do.”

Amid that backdrop, Ms Reeves set out her three priorities for the budget: “Protecting our NHS, reducing our national debt, and improving the cost of living.”

Cutting inflation will also be a key aim in her announcements later this month, and “creating the conditions that [see] interest rate cuts to support economic growth and improve the cost of living”.

She rejected calls from some Labour MPs to relax her fiscal rules, reiterating that they are “ironclad,” and arguing that the national debt – which stands at £2.6trn, or 94% of GDP – must come down in order to reduce the cost of government borrowing and spend less public money on interest payments to invest in “the public services essential to both a decent society and a strong economy”.

She also put them on notice that cuts to welfare remain on the government’s agenda, despite its humiliating U-turn on cuts to personal independence payments for disabled people earlier this year, saying: “There is nothing progressive about refusing to reform a system that is leaving one in eight young people out of education or employment.”

And the chancellor had a few words for her political opponents, saying the Tories’ plan for £47bn in cuts would have “devastating consequences for our public services,” and mocked the Reform UK leadership of Kent County Council for exploring local tax rises instead of cuts, as promised.

Concluding her speech, Ms Reeves vowed not to “repeat those mistakes” of the past by backtracking on investments, and said: “We were elected to break with the cycle of decline, and this government is determined to see that through.”

‘Reeves made all the wrong choices’

In response to her speech, Conservative shadow chancellor Sir Mel Stride wrote on X that “all she’s done is confirm the fears of households and businesses – that tax rises are coming”.

He wrote: “The chancellor claims she fixed the public finances last year. If that was true, she would not be rolling the pitch for more tax rises and broken promises. The reality is, she fiddled the fiscal rules so she could borrow hundreds of billions more.

“Every time the numbers don’t add up, Reeves blames someone else. But this is about choices – and she made all the wrong ones. If Rachel Reeves had the backbone to get control of government spending – including the welfare bill – she wouldn’t need to raise taxes.”

He called for her to resign if she raises taxes.