What is the winter fuel payment and why has it been axed?

10 September 2024, 17:17 | Updated: 10 September 2024, 18:09

Millions of pensioners are set to lose winter fuel payments after the government won a Commons vote today.

Chancellor Rachel Reeves announced the universal payment would come to an end when she laid out measures to tackle a £22 billion "black hole" in public finances.

The controversial move will see 10 million people stripped of their fuel allowance this winter.

Labour had previously said they would not hold a vote on the decision, but u-turned after facing a backlash.

Here's everything you need to know.

What is the winter fuel payment?

The benefit was introduced in 1997 by the chancellor at the time, Gordon Brown, and it was intended to help other people with the cost of heating during the cold winter months.

It's paid annually in autumn and is either £200 or £300, depending on age, and had always been universal.

This means it was given out to everyone, regardless of income or wealth.

However, when speaking to the Commons in July, the Chancellor Rachel Reeves announced that for the first time the payment would only be given to older people in receipt of pension credit.

It will be means tested, and pensioners will have to answer 243 questions over 22 pages in order to claim the payments.

They will be asked questions such as "Does you partner agree to your application?" and "Is your partner in hospital as an inpatient?" on the form.

Read more: Keir Starmer defends scrapping winter fuel payments - as he warns autumn Budget will be 'painful'

Read more: Pensioners will have to answer 22 pages of questions to claim winter fuel payments

Why has it been scrapped?

The call to axe the winter fuel payment is an attempt to save money.

In July the Chancellor outlined several cuts in an attempt to fix what she said was a £22 billion hole in the government's finances, which she said was left by the Tories.

Cutting the winter fuel payment is expected to save approximately £1.5 billion a year.

The decision is also part of Labour's stance on making tough, sometimes unpopular, decisions to clear up the economic mess left from the previous government.

What has the reaction been?

A big complaint has centred on how the scrapping of the payment came suddenly, without engagement or consultation.

MPs say this has gone down badly with certain voters, with some indicating they will never vote Labour again.

Fifty three Labour MPs did not have a vote recorded, including Northern Ireland Secretary Hilary Benn, Paymaster General Nick Thomas-Symonds, Foreign Office minister Stephen Doughty, Defence minister Maria Eagle and Home Office minister Dame Diana Johnson.

One member of the party - Jon Trickett - voted with the Conservatives.

In a statement posted on X, he said: "This winter will be extremely difficult for my constituents of all ages. After years of obscene profiteering by energy companies, they are hiking bills once again.

"I fear that removing the payment from pensioners will mean that many more will fall into poverty this winter. We know that the consequences of pensioner poverty are devastating.

"It can even be a matter of life and death. I have worked behind the scenes to try and change the Government's position, but to no avail.

"Our country is richer than it's ever been, but the wealth is not shared fairly. In my view the Government should be looking to raise revenues from the wealthiest in society, not working class pensioners.

"I could not in good conscience vote to make my constituents poorer. I will sleep well tonight knowing that I voted to defend my constituents."

Shadow work and pensions secretary Mel Stride criticised the government for not producing an impact assessment on the cuts to winter fuel allowance.

He told the Commons on Tuesday: "We have had no explanation as to why no impact assessments were provided. This is a major policy change which will remove entitlement for up to 10 million pensioners, including many who are already in poverty."

"It is a cut worth seven and a half billion over the course of this Parliament, rushing such a policy through without taking time to consider impacts, or ensure effective and fair implementation and allow possible scrutiny, is impossible to justify."

He added: "The reality is the Government want to rush this through so they can blame it on their predecessor, as I said, to avoid proper scrutiny.

"There is no need whatsoever for the haste with which this is being done, other than to meet the political ends of the Labour Party.

"They are ripping the plaster off and hoping the country will have forgotten by the time of the next general election, that is at the heart of it.

"But we will not forget. We would not have been given the opportunity to debate and vote on this measure without significant pressure from both the opposition and the wider public.

"This has nothing to do with fiscal responsibility and everything to do with political expediency. No scrutiny, no impact assessment, no notice. This is an appalling way to govern."

Emi Murphy, warm homes campaigner at Friends of the Earth, said: “It’s not surprising, but it is disappointing that MPs didn’t block the government’s plans to scrap the winter fuel allowance for millions of pensioners, just a month before energy bills shoot up again and with the colder months inching closer.

"Earlier this year, our research with the Institute of Health Equity revealed the enormous health impacts and economic burden caused by the lack of action to upgrade the nation’s homes - the latter including avoidable NHS costs.

"Cutting the winter fuel allowance for those that need it could add yet more pressure to our overstretched health service.

“Besides the urgency with which the government must publish its promised Warm Homes Plan for insulating homes, which will ensure they are warm and cheap to heat, there remains a pressing need for financial support for all low-income households facing another winter of deeply unaffordable energy bills - not just pensioners."