Pensioners 'should have to opt in for winter fuel payment'

Updated
Energy saving
Energy saving



Pensioners should no longer receive the winter fuel payment automatically, a think-tank has said.

In a manifesto revealed today, Policy Exchange says that pensioners should have to specifically opt in to the system. As a result, it says, many wealthy people wouldn't claim the payment, saving the Treasury an estimated £400 million a year.

Policy Exchange claims that only 10% of pensioners are unable to heat their home to a comfortable temperature and really need the £200-£300 annual payment, which currently goes to all people receiving the basic state pension.

"The system needs to be made simpler, more effective, fairer, more affordable, and should reward contribution," says Steve Hughes, author of the report.

"Presenting pensioners with a choice to receive their winter fuel payment could lead to hundreds of millions of pounds worth of savings, and is just one way to root out perceived unfairness."

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To protect those most in need, says Policy Exchange, people receiving pension credit should continue to get the winter fuel payment automatically.

Currently, it's possible for pensioners to cancel their winter fuel payment if they feel they don't need it; however, an FoI request by Policy Exchange has revealed that only 331 people have ever done so. The organisation believes this shows that pensioners that can afford to do without the payment need a bit of a nudge.

Others, though, might argue that this shows pensioners believe they need the payment. Last November, figures from Age UK revealed that almost half of older people were concerned about how they were going to stay warm through the winter.

Over the last ten years, says Age UK, a staggering 250,000 older people have died from the cold - one every seven minutes. While Age UK's charity director, Caroline Abrahams, says the only long-term solution is better insulation, "In the short term we would urge all older people to claim the benefits they're entitled to so they can afford to turn the heating up and stay warm," she advises.

The Poicy Exchange plan has a good chance of making it into law: it forms part of a report aimed at helping the Conservatives balance the books and achieve their target of £12 billion in welfare cuts after the general election.

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Other measures include limiting child benefit to four children per household, with progressively reduced weekly payments for each child after the first. This, says Policy Exchange, could cut £1 billion from the welfare bill over the course of the next Parliament.

Including the state pension in the welfare cap will also come under consideration, as will replacing contributory Jobseekers Allowance with a new national unemployment scheme and system of personal welfare accounts.

Every worker in Britain would make weekly contributions into the scheme – offset by a cut to their National Insurance - and build up a 'pot' that could be used in times of unemployment.

"Other measures to make social security better suit the needs of the individual, that make spending more transparent, and take into account an individual's contributory record should be priorities for the next government," says Hughes.

Read more on AOL Money:
One in 10 homes 'in fuel poverty'

Call to curb winter fuel payments

UK Weather: Drivers Warned to Be Vigilant as Temperatures Plunge to -11c
UK Weather: Drivers Warned to Be Vigilant as Temperatures Plunge to -11c






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