The final act in a slow-motion U-turn on the Winter Fuel Payment policy has been completed, putting an end to criticism from Labour MPs. The decision, which was first announced in July last year, aimed to save £1.5 billion annually by limiting the payment to pensioners with means-tested benefits.
However, the move sparked widespread backlash, with hundreds of newly elected Labour MPs receiving complaints from constituents. Despite repeated discussions and iterative U-turns, the policy remained a contentious issue throughout the summer.
The government has now confirmed that the new threshold will be introduced this coming winter, and it is projected to cost £1.25 billion. To mitigate the costs, ministers claim there won’t be a “permanent” increase in borrowing. However, the long-term impact on borrowing and other budgets remains unclear.
For Labour, the Winter Fuel Payment policy has been a defining moment of their first year in office. They will now hope to put this behind them, but it is likely to remain a part of the government’s biography, with questions surrounding the decision being raised by critics. The upcoming Spending Review on Wednesday may also provide additional insight into how Labour navigates potential future budgetary challenges.
Source: https://www.bbc.com/news/articles/c79eg04r0vvo