Martin Lewis issues passionate plea to Rachel Reeves to change winter fuel payment rules ahead of Budget next week
MARTIN Lewis has issued a passionate plea to Rachel Reeves to change winter fuel payment rules ahead of the Budget next week.
The consumer expert appeared as a guest on the The Rest is Money podcast this week and revealed what he thinks the government needs to do in the statement on Wednesday.
Martin revealed that he has had two meetings with Chancellor Rachel Reeves since Labour came into power.
His main concern is the changes to the winter fuel payment rules which were announced in the summer.
In July the Government announced the payment would become means-tested meaning only those on certain benefits are eligible.
This includes those on income support, tax credits, Universal Credit, and largely Pension Credit.
This means that around 10million pensioners will no longer get the cash, which can be worth up to £300.
Martin said he believes the Chancellor is “listening” to his thoughts.
He said: “I wrote an open letter to the Chancellor that mirrors my thoughts – the difficult bit is I can’t tell you what she’s saying back to me although she is listening.
“Clearly on winter fuel payment, I think they need to do some adaption and we need to see some mitigation coming into the Budget.
“For me, I have no problem getting rid of the universality of the winter fuel payment – millionaires don’t need it.”
Outling the issues he has with the move, he said firstly that the level of means-testing at an income of £11,400 a year is too low – and that it should be higher than that, closer to the “early £20,000s”.
The second point, and what he says is probably the more “urgent and difficult one”, is that he thinks the method of means testing is wrong.
Martin explained: “Because pension credit – something I’ve been trying to shout about for the last decade – is a benefit that we currently think around 800,000 of the poorest in society do not claim.
“They are entrenched into not claiming often due to mental capacity or dementia type issues or the 240-page form.
“So we are to use a critically underclaimed benefit to be the means-test – is something I have a real problem with.”
He added that he has spoken with the government both “publicly and privately” on this and that even if it managed to cut the number to 700,000, that’s still hundreds of thousands of people who are the most vulnerable earning under £11,400 who will lose winter fuel payment.
What is the Winter Fuel Payment?
Consumer reporter Sam Walker explains all you need to know about the payment.
The Winter Fuel Payment is an annual tax-free benefit designed to help cover the cost of heating through the colder months.
Most who are eligible receive the payment automatically.
Those who qualify are usually told via a letter sent in October or November each year.
If you do meet the criteria but don’t automatically get the Winter Fuel Payment, you will have to apply on the government’s website.
You’ll qualify for a Winter Fuel Payment this winter if:
- you were born on or before September 23, 1958
- you lived in the UK for at least one day during the week of September 16 to 22, 2024, known as the “qualifying week”
- you receive Pension Credit, Universal Credit, ESA, JSA, Income Support, Child Tax Credit or Working Tax Credit
If you did not live in the UK during the qualifying week, you might still get the payment if both the following apply:
- you live in Switzerland or a EEA country
- you have a “genuine and sufficient” link with the UK social security system, such as having lived or worked in the UK and having a family in the UK
But there are exclusions – you can’t get the payment if you live in Cyprus, France, Gibraltar, Greece, Malta, Portugal or Spain.
This is because the average winter temperature is higher than the warmest region of the UK.
You will also not qualify if you:
- are in hospital getting free treatment for more than a year
- need permission to enter the UK and your granted leave states that you can not claim public funds
- were in prison for the whole “qualifying week”
- lived in a care home for the whole time between 26 June to 24 September 2023, and got Pension Credit, Income Support, income-based Jobseeker’s Allowance or income-related Employment and Support Allowance
Payments are usually made between November and December, with some made up until the end of January the following year.
Pensioners still left out in the cold
Martin outlined the calculations “And if we look at the maths of what’s going on here and we actually look at the numbers of winter fuel payment, energy bills this year will be around £100 lower than last year from the October to March period, so you’re £100 up.
“But last year, you got the cost of living payment of £300, so now you’re £200 down, plus if you take away winter fuel on top of that – which is either £200 if you’re under 80 or £300 if you’re over – you’re now £400 to £500 down.”
While the triple lock uprating of the state pension will boost payments for some people next year, Martin believes because it’s so few people it won’t make a difference.
This is because: “the number that is stated is the full new state pension which is around £460 it’s going to go up – but first of all only 1 in 4 pensioners are on the ‘new’ state pension – 3 in 4 are on the ‘old’ state pension – which as it’s smaller is seeing an uplift of around £100 less.
“And second the word ‘full’ – you only get that if you have your full National Insurance contributions and by definition, most people eligible for pension credit do not have their full National Insurance contributions so their rise will be proportionately less than the £360 odd figure.”
Martin pointed out that after adding all of this up, those 780,000 pensioners missing out on pension credit will “almost certainly be materially worse off” this year despite the triple lock increase in April.
He expressed his disappointment with the decision: “I just feel and I’ve never phrased it this way but I’ll be honest because this is a different type of podcast – I just find it quite difficult that it is Labour doing this.
“I can’t understand why Labour is allowing 780,000 of the poorest and most vulnerable pensioners that they believe should get the winter fuel payment to not get it.”
He then explained that a potential “workable but imperfect” solution he had suggested to the government is the payments should be given to those on pension credit, as well as those pensioners in council tax bands A to C
This would cover off around 80 to 90% of those who are the poorest pensioners, he said.
Martin explained: “It wouldn’t save the government as much, would be between £1 and £1.2billion as opposed to £1.8billion, but the great thing about council tax is you’re either in band A to C or you’re not – you’re either a pensioner or you’re not – it’s a very easy means test.
“I am hopeful, that Rachel will put some form of increased mitigation measures in – she’s never going to U-turn.”
The Sun's Winter Fuel S.O.S Campaign
THE Sun's Winter Fuel SOS Campaign is here to support households during these challenging times.
Due to government cutbacks, ten million pensioners are set to lose the £300 Winter Fuel Payment.
Since opening our phone lines to thousands of pensioners in October, we remain dedicated to providing tips and advice on how to stretch your finances further.
That’s why we have partnered with the poverty charity Turn2Us to launch a free benefits checker, helping you ensure that you are claiming all the benefits to which you are entitled.
Don’t miss our latest Sun Money coverage, which includes essential information on key deadlines, applying for support, and everything you need to know about Pension Credit.
If you have a story to share or wish to get in touch with our team, please email us at money-sm@news.co.uk.
What Martin Lewis would like to see in the Budget
As well as the changes to the winter fuel payment eligibility rules, Martin also briefly outlined each of the things he would like to see discussed in the Budget.
- Carer’s Allowance – taper needed to avoid thousands having to pay back benefits due to earning slightly over
- LISA penalty – removal of the fine if you buy a property above the £450,000 limit
- Standing charges – standing charges on energy need to be reformed
- Tax-free childcare – name needs to be changed as too difficult to understand, should be called the “working parent childcare top-up”
- Smart meters – regulations need to change so that companies are fined based on those which are working, not installations
- High-income child benefit charge – needs to be a household assessment rather than an individual assessment
- Mortgage prisoners – need to bring help in for the 200,000 affected
Do you have a money problem that needs sorting? Get in touch by emailing money-sm@news.co.uk.
Plus, you can join our Sun Money Chats and Tips Facebook group to share your tips and stories