Winter fuel allowance payments have been scrapped for millions of pensioners by the new Labor government

Rachel Reeves said almost 10 million pensioners would be cut off from paying the winter fuel allowance. The Chancellor has said essential payments will not be extended to those who are not eligible for Pension Credit or other means-tested benefits.

Expressing her frustration, she attributed the drastic cut to a £22 billion “black hole” in the public finances. Reeves confirmed that people eligible for means-tested benefits will still receive their payments. Addressing the Commons, she announced: “I am taking the difficult decision that those who do not receive Pension Credit or certain other means-tested benefits will no longer receive their winter fuel payments.”

She further clarified the Government’s position on the provision of fuel payments, saying: “The Government will continue to provide fuel payments of £200 for households receiving Pension Credit or £300 for households receiving Housing Credit pension, with a person over 18 years old. Let me be clear that this is not a decision I wanted to make.”

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The announcement was part of a series of cost-saving measures offered during a contentious session of the Commons. Reeves condemned the Tories for their “grossly irresponsible” actions and reiterated his position by saying: “If we can’t afford it, we can’t do it,” reports the Mirror.

In the previous winter season 2021-22, 11.3 million winter fuel payments were made. The Winter Fuel Payment, introduced in 1997, is designed to help pensioners with their heating costs and is a tax-free annual benefit of between £100 and £300.

The newly appointed Chancellor affirmed the Government’s commitment to the triple lock, which ensures the protection of the state pension. Mrs Reeves, along with Work and Pensions Secretary Liz Kendall, plans to overhaul the provision of Pension Credit and Housing Benefit to prevent people falling through the cracks.

She promised to work with charities that support the elderly. MoneySavingExpert founder Martin Lewis reacted to the statement with concern about the potential serious consequences. He noted: “Many pensioners are paying winter fuel payments of between £100 and £300 to enable them to keep their heating on during the cold months. While there is an argument for ending its universality due to tight national finances, it is stretched too thin. a group only those receiving benefits and pension credit. Again, those who are just over the thresholds will be the hardest hit.”

Lewis also highlighted the urgent need for the Government to assist the estimated 800,000 people who qualify for Pension Credit but are not currently receiving it. Mr Lewis explained: “Pension Credit is an essential benefit which provides access to a number of other entitlements and now, with the link to the Winter Fuel Payment, it makes it even more important to ensure less loss.”

In addition, Ms Reeves called for the sale of government-owned properties and a tightening of unnecessary spending, while criticizing the Tories for allegedly misrepresenting the grim reality of public finances.

The chancellor told MPs that urgent action was to be implemented following an audit which revealed that the last administration went £35bn over budget, resulting in a £22bn deficit. She has pledged to set up a new Office for Value for Money, which will be tasked with identifying immediate savings.

A deficit of around £20 billion has been reported to the Commons. The chancellor is set to promise to cut wasteful spending on consultants and has ordered officials to sell off “surplus” government properties.

In addition, the chancellor is calling for accelerated cuts in administrative costs. Ms Reeves has banned future ministers from announcing surprise budgets like the one introduced by Liz Truss, which has exacerbated the struggles of many.

During her speech to the Commons, she acknowledged the challenges anticipated during the election campaign, but admitted she was unaware of the scale of the problems. She said: “Before the election, I said we would be facing the worst legacy since the Second World War… But on my arrival at the Treasury three weeks ago, it became clear that things which I did not know”.

She accused the opposition party of withholding information from the nation, saying: “Things that the opposite party hid from the country.”

She will continue: “It’s time to stand up to the public and tell them the truth. The previous government refused to take the hard decisions.”

“They hid the true state of public finances. And then they ran. I will never follow suit.”

Ms Reeves initiated a review of spending between government departments and related entities upon taking office earlier this month, which led to unexpected findings, according to Environment Secretary Steve Reed. Speaking on Sunday, he described the economic legacy left by the Tories as disastrous.

He suggested the Conservative Party was “spending money like there’s no tomorrow” and that they were hiding the seriousness of the situation. He blamed the former administration for the “politics of denial and cover-up”, commenting: “The legacy from the previous Government was catastrophic, they spent money like there was no tomorrow, they called elections, they ran away and they have” try to deny this .”

The cabinet member expressed shock at some of the findings, including problems in Britain’s prison system where prisoners are being released early to accommodate new offenders and the exorbitant costs of Rwanda’s deportation plan.

When asked if Labor had been blindsided by these challenges, Mr Reed said: “Not only did we not know, the Prime Minister (Mr Sunak) deliberately covered it up.”

He further explained to the BBC’s Victoria Derbyshire: “The idea is that we go into our departments and find additional pressures that nobody knew about and the government didn’t disclose.”