Cabinet ministers have grave concerns about Rachel Reeves’s plan to axe the winter fuel allowance for all but the poorest pensioners, the Guardian can reveal.
Frontbenchers believe the government will have to announce extra support in the budget or even earlier to cushion the blow for some of the people worst affected by the cut.
On 29 July, the chancellor announced plans to scrap the winter fuel allowance for all pensioners in England and Wales except those on lower incomes who received pension credit.
The decision, which affects about 10 million people, has sparked an outcry from charities including Age UK and from over-65s who have appealed to their MPs. Several cabinet sources told the Guardian they were concerned that holding the line on the winter fuel allowance would be unsustainable.
One cabinet source said they were worried about the fallout from the policy as the days got colder and energy prices rose. “It hasn’t even been thought through properly. We’re going to end up with more old people in hospital or care as a result, with all the costs involved in that,” they added.
Government figures are preparing to engage with concerned MPs over the weekend before a vote on the policy on Tuesday, but a Downing Street source said there was no prospect of a U-turn.
Reeves will address Labour MPs at the parliamentary Labour party meeting on Monday evening. A Treasury source said: “It is a tough decision but we have a £22bn black hole that we have to tackle. Everyone recognises that we have to get a grip on the public finances.” They said the government was protecting the pensions triple lock and investing in a campaign to get as many people on pension credit as possible.
Another cabinet minister said: “I don’t think people have fully grasped how difficult the in-year deficit is for the government … This isn’t an easy decision for the chancellor to make but people have got to get behind her so she makes the tough decisions now.”
The new Labour intake’s WhatsApp group had had a string of messages about the issue, MPs said. Labour backbenchers have been spooked by the volume of correspondence they have received, with one saying they had gone from receiving a trickle of emails from worried constituents to a flood this week.
“It’s going to save us £1.5bn but that won’t be worth the political hit we’ll take this winter,” the MP said. “The rightwing press will be full of stories about elderly people sitting in A&E or on buses because they can’t afford their fuel bills and it’s the only way they can keep warm.”
Another Labour MP said: “I don’t think there is a Labour MP who isn’t worried. We’re talking to our constituents, reading our emails, this weekend we’ll be in our constituencies. I’ve had more people stopping me in the street than over Brexit. Pensioners just pleading that we don’t do this.”
A third Labour MP who represents a marginal seat said they had received about 200 emails on the issue, many of them along the lines of: “I’ve just voted Labour for the first time but never again”. A fourth MP said they were getting “absolutely tonnes” of correspondence and added: “Of all the emails I receive it’s the one [issue] where they are absolutely not coordinated. They are not part of a campaign.”
The Lords’ secondary legislation scrutiny committee warned this week that the move “may cause potential inequalities between low-income pensioners claiming benefits and low-income pensioners not claiming benefits, and it is not clear whether [the Department for Work and Pensions] has assessed this risk”. It added that the policy’s quick implementation “precludes appropriate scrutiny”.
Andy Burnham, the mayor of Greater Manchester, told the BBC on Thursday he had “concerns” and would be making representations to the government before the budget.
Some MPs have noted that local and regional newspapers are covering the cut extensively, including by pointing out how many thousands of local people will be directly affected. “It’s a cut people notice straight away, directly out of their pocket, it’s the most damaging kind,” a fifth Labour MP said.
The charity Age UK, which is campaigning against the cut, has emailed Labour MPs this week with the number of people who will be affected in their areas.
The average constituency in England and Wales has 16,000 pensioners who will lose their winter fuel payments under the government’s plans, of whom 1,500 are eligible for but not receiving pension credit, according to Age UK analysis of DWP data.
The former chancellor Ed Balls said on the Political Currency podcast that he believed the government would need to backtrack in some form. “If you’re Keir Starmer and Rachel Reeves and their teams, you’ll be looking at the polling, you’ll be looking at the focus groups. They will be saying: ‘This is a big problem, and it’s going to get worse’. I don’t think you can just plough on. I don’t think you can do a U-turn, but what they need is an escape route.”
Balls added: “This isn’t just a storm in a teacup. This is one of those big cut-through issues which has real momentum. It unites the left and the right.”
Even those who supported the move admitted they had received a lot of correspondence about it. One Labour MP in a marginal seat said they had been contacted about this issue more than anything else, but stressed: “We are going to need to make incredibly difficult decisions over the coming months and the worst possible outcome would be if we allowed ourselves to get knocked off course by the email inbox.”
For the left, Tuesday’s vote has become a purity test for those who did not support the two-child benefit amendment that resulted in the suspension of seven MPs from the party in July. Several MPs who abstained or voted with the government in July after pressure from the whips have put their names to an early-day motion opposing the cut to the winter fuel allowance.
Others, however, said the suspensions in July would have a “chilling effect” on the number of rebels next week.
The early-day motion was tabled by Neil Duncan-Jordan, the Labour MP for Poole who previously worked for Britain’s biggest pensioner organisation. Two other new Labour MPs, Simon Opher and Chris Hinchliff, have signed the motion. Last week Duncan-Jordan chaired a briefing with Age UK where a number of Labour MPs highlighted their concerns, particularly about the sudden nature of the cuts.
“The mitigation put in by the government is insufficient,” said Rachael Maskell, the Labour MP for York Central who has been spoken out against the policy. “We have to go back to why Gordon Brown introduced this. He was emphatic that he didn’t want people to go cold over winter. We absolutely should uphold those values.