Martin's suggestion for winter fuel allowance

MattMattMattUK

Grumpy_chap said:

Scot_39 said:

I have seen face to face 2 elderly neighbours  - of 5 of state age  in a small close of 13 - in a nice area - not poor council estate etc - anxious to turn heating on - through fear in recent years. 

I think this whole thing around pensioners not understanding when they are in a financially acceptable position is probably more if anu issue than gets recognised.

It is a huge issue both ways, and also a disconnect from the working world. My mum is in her seventies, her and her friends all have pensions in the £30-50k pa range, they sit very comfortably yet still seem to worry about the cost of heating their homes, homes which are mortgage free, when in reality they are all totally financially comfortable. When I asked they also seemed to think the minimum wage was around £20 per hour and seemed to think that the average income was around the £45k pa mark.

Grumpy_chap said:

My MiL was speaking about the end of the WFA and how it would affect her, so she had spoken to an Advisor (I am not quite sure where) about PC and was advised that her SP is £2 per week above the threshold for PC, so she is not eligible and not able to qualify for WFA either.  She thinks she is hard done by.
Except, her next sentence was "of course, I've got my private pension on top of my SP plus savings".

That does seem to be a huge issues, I have a friend who is 68, he feels hard done by because he claims he is struggling with bills and to pay his mortgage currently (two years to go), yet this is someone who spends £30k+ travelling the world every year and only works around 20 weeks a year, either slightly more work, or slightly less travelling and he would be very comfortable, but for some reason that does not compute and he is now talking about not being able to heat his home this winter because of no longer getting the WFA, despite the fact that he will not even be in the country for half of winter. 

MattMattMattUK

Baldeagle095 said:

Personally I thought that Martin should have concentrated his fire on the regressive iniquitous Standing Charge.

The standing charge is rational, sensible and although I generally dislike the word "fair", as everyone pays for what they use. Though I note that many people's definition of fair is that "someone else pays". 

molerat

Starmer's paymasters are on the case now.

https://www.bbc.co.uk/news/articles/cvg5rl612n5o

Baxter100

The money spent on the WFA is around 0.16% of all government expenditure. To give some kind of perspective:

The UK government has total debt of around £2.8 trillion.

The UK government is currently borrowing around £125 billion every year.

The UK government spends around £115 billion every year on debt interest payments. This makes it the second biggest government 'department' in terms of expenditure.

If something cannot go on forever, it will stop.

wild666

born_again said:

wrf12345 said:

The simple solution remains, get rid of the WFA completely and get rid of energy standing charges, with the energy companies absorbing some of the increased unit cost in recognition of the way the govn helped them through the energy crisis (if Labour had been in power it would probably have let them go bust and nationalized them for "free", which will probably happen with some of the water companies). This would give the govn a nice boost in the popularity stakes as well. 

I guess you are too young to remember the pre privatisation days...

Costs were no better, infrastructure was no better. You only have to look at how bad many government sectors are to realise that public ownership is not the solve all ill's many seem to think it is.

End of the day, public or private ownership. Only one group pay's for it. Which is us mere mortals..

Getting rid of the SC's would increase the unit prices but this would see some, high users pay more as the kWh SC is based on the average of just over 8 kWh of electric used per day and the gas SC is based on around 33 kWh used per day so suppliers would receive less money in spring/summer and possibly a mild Autumn but receive most of their income in winter as users hit their gas usage in the cold winter months. 

HillStreetBlues

wild666 said:

born_again said:

wrf12345 said:

The simple solution remains, get rid of the WFA completely and get rid of energy standing charges, with the energy companies absorbing some of the increased unit cost in recognition of the way the govn helped them through the energy crisis (if Labour had been in power it would probably have let them go bust and nationalized them for "free", which will probably happen with some of the water companies). This would give the govn a nice boost in the popularity stakes as well. 

I guess you are too young to remember the pre privatisation days...

Costs were no better, infrastructure was no better. You only have to look at how bad many government sectors are to realise that public ownership is not the solve all ill's many seem to think it is.

End of the day, public or private ownership. Only one group pay's for it. Which is us mere mortals..

Getting rid of the SC's would increase the unit prices but this would see some, high users pay more as the kWh SC is based on the average of just over 8 kWh of electric used per day and the gas SC is based on around 33 kWh used per day so suppliers would receive less money in spring/summer and possibly a mild Autumn but receive most of their income in winter as users hit their gas usage in the cold winter months. 

I support getting rid or greatly reducing the SC even though it would make little difference to me.
With the rise of smart meters and different peak times, the unit price in pence would be greater between the tariffs so giving more encouragement to try and use off peak more.

Scot_39

Not necessarily.

My regional MR cap average rate in Ofgem cap has just increased c2.3p

My peak and off peak have increased almost the same - within 0.1p of each other.

But thats e10 at EOn. Who balance and shift peak off peak differently from EDF E10 published rates.

Just as in past have dropped very similar amounts - the largest recent cutvsimilar around 4.5p +/-0.2p iirc.  I'd have to check records at home for tge exact drops.

To save the average SC of 221 at 4200kWh - would need 5.2p on unit rates - ot much greater than last drop - there's no guarantee both my rates wouldn't track that within a verg small margin based on recent changes

wrf12345

Surprised Martin has not made the connection between balancing out removal of the WFA by abolishing the s/c's - there is marvellous simplicity to such an action and a certain fairness. The other point, many people refuse to hand over ever increasing amounts of money to energy companies, whether or not they are loaded up with "excess" dosh, the easiest way out radical reduction in gas and electric usage that would be helped along by removal of the s/c's. Helps Ukraine and saves the planet, too.

Grumpy_chap

MattMattMattUK said:

It is a huge issue both ways, and also a disconnect from the working world. My mum is in her seventies, her and her friends all have pensions in the £30-50k pa range, they sit very comfortably yet still seem to worry about the cost of heating their homes, homes which are mortgage free, when in reality they are all totally financially comfortable. When I asked they also seemed to think the minimum wage was around £20 per hour and seemed to think that the average income was around the £45k pa mark.

Your Mum and her friends may be similar to my parents and the disconnect from working world is a big part in my parents (well, only Mum now) understanding, or not understanding, their income.

When you work - typically - you get a salary - just one salary.  You receive a letter each year confirming what that salary is so you know exactly what the increase was for the year.  Any other income is - in the majority of cases - notional.  You pay tax as appropriate on that salary.  You know how that number - salary - compares with the average / others at the time.

(That was certainly the case for my parent's generation - I appreciate the proportion of people today with a more "flexible" nature of employment is higher.)

When you get a pension, there is no single figure received each year.  There are a whole host of components that add up to make a total:

• State pension
• Employment / private pension - quite often several paid in separate ways
• TV licence, bus pass, Christmas bonus, prescriptions, glasses, etc...

To work out a total equivalent to an employee, all these parts need summation and then add whatever is appropriate to convert from the "post tax received" to the "pre-tax gross" equivalent that an employed person would need to receive.

As for the two examples, they may not be that surprising.

• £20 per hour is probably what is paid for people (Cleaners, Gardeners) on minimum wage - how many of the population as a whole can adjust for company income to individual's income?
• 45k is probably driven by tabloid press reporting train drivers on £70k and such like:

https://www.thesun.co.uk/money/23245340/london-train-driver-salary-no-degree-catch/
https://www.telegraph.co.uk/money/jobs/career-advice/people-become-train-driver-87k-salary-love-working-alone/

• In fact, if your parents live in the South East, the £45k figure might be about right.  £35k across all of the country:

https://www.thetimes.com/money-mentor/income-budgeting/average-salary-london-uk

Scot_39

wrf12345 said:

Surprised Martin has not made the connection between balancing out removal of the WFA by abolishing the s/c's - there is marvellous simplicity to such an action and a certain fairness. The other point, many people refuse to hand over ever increasing amounts of money to energy companies, whether or not they are loaded up with "excess" dosh, the easiest way out radical reduction in gas and electric usage that would be helped along by removal of the s/c's. Helps Ukraine and saves the planet, too.

Without the govt paying the SC - say by EPG style payment direct to suppliers - and that if happened would only be say for a social tariff for those on pension credit - you have the same cross subsidy.

As Ofgem iirc discussed in their SC options - they were not able to presume any such additional money was forthcoming. When doing likes of their appendix a2-a7 sc to unit shift analysis.

And that only went up to £100 - but still saw all electric couple with kid losing to shift just £38 - around 20% of average SC.