Martin's suggestion for winter fuel allowance

Spoonie_Turtle

Ildhund said:

Swipe said:

... the WFA reinstated. 

The government decided at some stage to establish a minimum acceptable income for older people (Gordon Brown's Minimum Income Guarantee). This is higher than the State Pension, so Pension Credit was invented to make up the difference. I'm not sure what the acceptable minimum is now, but it's clearly around £220 pw for a single person living alone. Anyone whose income (adjusted for the value of any savings) exceeds this isn't eligible for PC and in consequence won't receive the WFA this year. 

It's been lower than the State Pension for some time.

Currently £218.15 for a single person; State Pension is £221.20/week.

(The working-age person's minimum income is £90.50 unless under 25.  Just as some extra context.)

Qyburn

I don't get the logic behind penalising people in larger or more valuable houses, on the grounds that they could or should have moved in the past. That's not much different from dissmissing low income on the grounds that thay could have saved for retirement in the past. In fact worse because people wouldn't have been aware say 10 years ago that benefits would be withdrawn if they didn't move.

Ildhund

Spoonie_Turtle said:

Currently £218.15 for a single person; State Pension is £221.20/week.

Thanks. That is the 'New' State Pension, for youngsters born after 1950 or later. Old codgers like me get much less (up to £169.50), so PC is pretty vital. Nevertheless, I don't find that £3.05 a week difference particularly significant. OK, it would allow me to switch on my one-bar electric fire for an hour or two a day, I suppose, and every little helps. 

My point is that for those whose income is over £220 a week, missing out on a £200 bonus isn't the end of the world like some of the media are trumpeting. I certainly don't feel poverty-stricken with my regular, tax-free £218.15 a week. 

TheBanker

SAC2334 said:

spot1034 said:

Swipe said:

Since the announcement of the October cap increase, the government is under increasing pressure over this decision. I really wouldn't be surprised if this is overturned and the WFA reinstated. Even the Guardian newspaper has turned on them over this.

They would have been well aware that this was coming though. It was hardly a secret that the price cap was set to increase significantly - in fact, I'd suggest it might have been a factor in Rishi Sunak calling the election in July.

I suppose one thing they could do is reinstate it but make it taxable like the state pension itself, which would at least see some of the money being clawed back from the better off. 

In the earlier part of the three month cycle the October price cap was being predicted to be going down not up so I m not sure that anyone was "well aware " what it was going to be . Personally I can t see Labour back tracking on this and going for M.L idea of council tax bands . D for intance are quite wealthy properties in my area . I m on basic pension of £8952  a year but have savings I need to keep to pay for private eye operations in the future and can t claim PC . Glad to see that train drivers on an average of £81000 a year got a rise which they really need badly more than me .

Unless I am mistaken you got a rise too, of 8.5% in April 2024, following a rise of 10.1% last year. I think this works out to be a higher percentage increase the train drivers got. And remember that a proportion of the train drivers' increase will find its way back into the Treasury coffers through higher rate tax payments and extra National Insurance.

I am sorry you are losing your £3.84 per week but the current system is no longer affordable. Pension Credit is the system designed to make sure pensioners can cover their living costs; I'm sorry you're not able to claim this.

pseudodox

Council Tax banding cannot possibly be the answer to who gets benefits and who doesn't.  I lived a fairly frugal life so I could afford a nice house in a nice area in my retirement.  I have no family & even if I did they would not be getting an inheritance that I may need to spend eventually on care home fees.  My only income is the SP (with some emergency funds in a savings account which prevent me claiming pension credit) but my current house CTB would not get me the WFA as proposed by ML.

If I downsized, released a load of capital and moved to a cheaper house in a cheaper area in a lower tax band then the WFA I could maybe then claim, based solely on that CTB and not on income/benefits, would be a very nice addition to the pot of cash I could have banked from the sale of current house.  But not needed as I already manage quite nicely on SP to afford my house, afford to heat it to a reasonable level etc.  The past WFA has been a nice bonus, but I was never dependent on it.  I pay more in CT than I do for energy each year.

TheBanker

pseudodox said:

Council Tax banding cannot possibly be the answer to who gets benefits and who doesn't.  I lived a fairly frugal life so I could afford a nice house in a nice area in my retirement.  I have no family & even if I did they would not be getting an inheritance that I may need to spend eventually on care home fees.  My only income is the SP (with some emergency funds in a savings account which prevent me claiming pension credit) but my current house CTB would not get me the WFA as proposed by ML.

If I downsized, released a load of capital and moved to a cheaper house in a cheaper area in a lower tax band then the WFA I could maybe then claim, based solely on that CTB and not on income/benefits, would be a very nice addition to the pot of cash I could have banked from the sale of current house.  But not needed as I already manage quite nicely on SP to afford my house, afford to heat it to a reasonable level etc.  The past WFA has been a nice bonus, but I was never dependent on it.  I pay more in CT than I do for energy each year.

Off topic for this thread, but I don't think the Council Tax system works for local authority funding, so I wouldn't want to extend it to other benefits. 

I don't think there should be a Winter Fuel Allowance at all. I think the state pension and pension credit should be set at levels that support a basic standard of living, including being able to heat your home. You could perhaps extend Cold Weather Payments to all pensioners to recognise that there might be a few unusually cold periods which require extra heat, over and above what's baked into the standard pension calculation. 

Ildhund

TheBanker said:

I think the state pension and pension credit should be set at levels that support a basic standard of living, including being able to heat your home. 

So you might suggest that the home's EPC rating should be taken into account when setting the amount of Pension Credit? How else would you assess the cost of heating for the enormous spectrum of housing types pensioners live in?

TheBanker

Ildhund said:

TheBanker said:

I think the state pension and pension credit should be set at levels that support a basic standard of living, including being able to heat your home. 

So you might suggest that the home's EPC rating should be taken into account when setting the amount of Pension Credit? How else would you assess the cost of heating for the enormous spectrum of housing types pensioners live in?

No, I wouldn't. I'd base the value of a state pension (including pension credit) on the average cost of living. I wouldn't try to adjust for higher heating bills, just like I wouldn't adjust if a pensioner decides to run a more expensive car or indulge in meals out instead of cooking at home. Just like the current system of a fixed £200 per annum doesn't take into account the actual cost of heating. 

It would seem quite unfair to take the EPC rating into account, as presumably someone who'd invested in making their home energy efficient while working would receive a lower heating allowance during retirement. Whereas someone who'd made no effort at all to improve their property would be rewarded with higher benefits.

Pensioners who live in houses that are too large have the option to downsize (although I'd question whether anyone would really do that for £200 a year) - this is obviously easier if planned in advance. Pensioners who live in badly insulated homes should be offered state help to make their property more energy efficient (but this should be means tested, I would not expect the state to pay to insulate a stately home just because the occupier is aged 70). In fact as insulation improves the EPC rating and therefore the property value, the state could treat it as a kind of loan, repayable from the proceeds of the eventual property sale. 

MP1995

The thread and other social media debates just goes to show that there are many ideas how this should work.

Then issue is if you start a new measurement system then that needs checking and adds overheads to the delivery of the hand out and eats into the money they are trying to save.

Labour, rightly or wrongly, have drawn a line in the sand and if they are strong in their decision that is that.

One of life's dilemmas "what would I do if in charge"

Spoonie_Turtle

Ildhund said:

Spoonie_Turtle said:

Currently £218.15 for a single person; State Pension is £221.20/week.

Thanks. That is the 'New' State Pension, for youngsters born after 1950 or later. Old codgers like me get much less (up to £169.50), so PC is pretty vital. Nevertheless, I don't find that £3.05 a week difference particularly significant. OK, it would allow me to switch on my one-bar electric fire for an hour or two a day, I suppose, and every little helps. 

My point is that for those whose income is over £220 a week, missing out on a £200 bonus isn't the end of the world like some of the media are trumpeting. I certainly don't feel poverty-stricken with my regular, tax-free £218.15 a week. 

Pension Credit passports to a lot of other financial help, so it's not necessarily just £3.05/week.

That said, it is possible pensioners living on the new State Pension alone are missing out on help because they've assumed that only Pension Credit would get them help such as Housing Benefit and Council Tax Support and therefore haven't applied.  The NHS also has the Low Income Scheme if they're struggling for health costs.

I don't have a horse in this race.  Just saying it's more complicated than 'if you don't qualify for Pension Credit you definitely aren't struggling and won't miss the money'.