Winter Fuel Payment

Baroness Stedman-Scott Excerpts

Tuesday 10th June 2025 Lords Chamber

[Baroness Stedman-Scott (Con)]

My Lords, I rise with a sense of relief, although not without regret: relief that the Government have chosen to reverse a policy that has caused distress and fear among our oldest and most vulnerable citizens, and regret that such a policy was every pursued in the first place. This reversal gives us cause to reflect on the true value of the winter fuel payment. For pensioners on modest incomes it has never been a luxury, and it has supported the most vulnerable through the darkest and coldest months of the year.

Although we welcome the Government’s decision to U-turn, we must not lose sight of how we came to this point. In December last year, I stood at this Dispatch Box and warned the Minister about the very consequences we are now discussing. At the time, I made it clear, and I reiterate today, that withdrawing the winter fuel payment from all but a limited group of recipients dealt a serious and unjust blow to millions of older people across the country. We made our position clear from the outset: the Government were wrong to scrap the winter fuel payments for millions of vulnerable pensioners.

These Benches opposed that policy on three key principles. First, it would have left millions of older people worse off during the coldest months of the year. Secondly, it reflected a misplaced set of priorities, favouring above-inflation pay rises for public sector workers over the needs of those in later life. Thirdly, it was introduced without transparency, with no reference to such a significant change during the general election campaign. We urged the Government to listen to the concerns raised across the House and consider alternative approaches to fiscal responsibility that did not come at the expense of those who can least afford it. This House raised those concerns. We reminded the Minister of the Conservative’s record on support for pensioners, with the triple lock, the warm home discount and the winter fuel payment itself.

As Churchill once remarked, a man who does not change his mind cannot change anything. As we rightly warned last year, removing the winter fuel payment was an appalling blow for pensioners. Today, the Government have done the honourable thing: they have listened, reflected and acted. Admitting a mistake is never easy, but correcting one is a mark of leadership. On this occasion, the Government have finally listened to your Lordships’ House. Is this a taste of things to come—that they will listen to the serious concerns we are raising on the most damaging elements of their policy platform? Will they row back on those parts of the Employment Rights Bill which will devastate small and medium-sized businesses? Will they finally act to protect our farmers from the punitive family farm tax? Will they halt their assault on the best schools in our country in the schools Bill?

This reversal is not only welcome but essential. It reaffirms our commitment to the millions of pensioners who depend on this support and upholds the integrity of our social contract with those who have worked hard and paid taxes all their life. Let this moment serve as a precedent that the voices of the vulnerable must be heard, that fairness must not be sacrificed for short-term savings and that the dignity of older citizens is not negotiable. That said, it is deeply regrettable that this reversal was ever necessary. The original decision was ill-conceived and caused needless anxiety and hardship for some of the most vulnerable in our society.

Although we welcome the change of heart, we are entitled to ask how it is being paid for. The Government have said that this U-turn will cost around £1.25 billion; if the economic outlook has not materially improved, as the Chancellor’s own figures suggest, then where is this money coming from? Are tax rises now on the table? If so, which taxes and on whom? Will the Minister confirm whether His Majesty’s Treasury intends to raise revenue through stealth taxes or whether further departmental budgets will be cut elsewhere to fund this reversal?

What of the administrative burden? Will pensioners with incomes above £35,000, in particular those with non-taxable income, now be required to complete tax returns? What guidance will be issued to those who may find themselves unexpectedly caught in a new reporting requirement? Further, will the Minister explain what happens to a pensioner who is widowed, inherits a pension and then finds themselves with an income over £35,000?

This House has a duty to speak out when the vulnerable are at risk. Today, we have fulfilled that duty. The Government have listened, but we must remain vigilant. I say to the millions of pensioners left in uncertainty this past winter: you were heard. I say to the Government: let this be a reminder that the strength of a society is measured not by how it treats the powerful but by how it cares for the vulnerable.

Although we welcome this change of heart, we need to understand how the Government have suddenly found the money to pay for it. In the end, the savings achieved by this policy may be as little as £50 million. Will the Minister tell the House whether it has been worth all the pain and aggravation? Will he apologise now to the millions of pensioners who struggled to get by this past winter?

[Lord Palmer of Childs Hill (LD)]

My Lords, this surely must be the Government of unintended consequences. When this policy was first mooted, I asked the Minister whether there would be any financial gain from it because, with the further uptake in pension credits, the actual money saved is miniscule. It is nothing like what the Government said they would get, so we have gone through all this pain and people have suffered, all for a strange bit of ideology.

Following on from what the noble Baroness on the Conservative Front Bench said, reports in the media suggest that winter fuel payments will be made automatically as a universal benefit this winter. Money will then be reclaimed when higher-income pensioners fill in their tax returns. Can the Minister say how the Government will ensure that the new system does not mean that the bereaved families of tens of thousands of dead pensioners—not only widows and widowers but dead pensioners—will be pursued by tax officials to recoup the payments? The Government of unintended consequences strike yet again.

Although the Chancellor has finally acknowledged the failure of this policy—thanks to sustained efforts by the Liberal Democrats and others—the scale of the distress created must not be forgotten. Do the Government intend to uprate the £35,000 threshold in line with inflation in future years?

This has been a disastrous policy. It has not raised the money we were told it was intended to raise. There will be further distress down the line while they try to sort out this mess.

[The Financial Secretary to the Treasury (Lord Livermore) (Lab)]

My Lords, I am very grateful to the noble Baroness, Lady Stedman-Scott, and the noble Lord, Lord Palmer of Childs Hill, for their questions and comments. I am grateful to the noble Baroness for welcoming this change of policy, and I thank both speakers for the consensus that now exists across the House on the current policy position.

The noble Baroness began by asking how we got here. We got here, of course, because when we came into office, we had to make a number of very urgent decisions to put the public finances back on a firm footing. That involved us taking some very difficult decisions on welfare, tax and spending, including means testing the winter fuel payment. I am very grateful to her for noting that we have now listened to the concerns raised, inside and outside this House, about the level of the means test.

The noble Baroness asked about the savings that will be generated from this policy. As she rightly said, we expect the policy to cost around £1.5 billion a year in total, including £1.25 billion in England and Wales, by the end of this forecast period. She asked about the savings that this would generate. It is estimated to save around £450 million a year, compared to universal winter payments.

The noble Baroness asked when and how this would be paid for. We are setting out these changes now to ensure that more pensioners can receive support this winter—that is the right thing to do. There is now just one fiscal event a year, so, as is normal, these changes will be fully funded at the next fiscal event, which is the Autumn Budget. This will ensure that final costings and funding decisions come alongside a full forecast from the OBR, and we will ensure that the fiscal rules are met at all times.

The noble Baroness also asked about the other policies we are pursuing. It was appropriate that, ahead of tomorrow’s spending review, she reminded us that the party opposite has not supported a single policy that we have put in place to stabilise the public finances or to raise money for public services. When we have tomorrow’s spending review, it will be very interesting to hear from the party opposite that it now supports all the spending we are doing, even though it did not support a single one of the difficult measures we took to raise money for public services. It is very interesting that she opposed the Employment Rights Bill, because we again see that her party does not support a single measure to improve the lives of working people.

[Baroness Stedman-Scott (Con)]

That is not true.

[Lord Livermore (Lab)]

Well, I think it is true.

The noble Baroness asked specifically about the tax system. No additional pensioner will be brought into the tax system because of this change; we can give that assurance to the House today.

The noble Lord, Lord Palmer of Childs Hill, asked about recouping payments from deceased people. HMRC has established processes in place to recoup payments and finalise the tax affairs of deceased people, so nothing will change because of this policy. This is not a taxable payment. We assure the House that, if this is the only outstanding tax charge remaining from a deceased person, HMRC will not pursue anyone just for this specific amount of money. The noble Lord also asked whether we will uprate the threshold of £35,000. We will set that out in the Budget.

Small Business, Enterprise and Employment Bill

Baroness Stedman-Scott Excerpts

Wednesday 28th January 2015 Grand Committee

[Baroness Neville-Rolfe]

My Lords, the tied model has long been part of our history. As my noble friend Lord Hodgson said, properly operated it can be beneficial to both pub company and tied tenant. However, as the Government made clear in their consultation response, the evidence has accumulated of problems of abuses of the tied relationship. In an online survey carried out in parallel with the Government’s consultation, 91% of more than 700 tenants identified the beer tie as the biggest challenge that they face. In the government amendments that I am moving we are focusing the market rent only option on the tied model, consistent with rest of this part of the Bill. All of this part will then apply to pub-owning companies which own 500 or more tied pubs.

In contrast, the MRO option inserted into the Bill in the other place would apply to companies with 500 pubs of any kind and one tenanted or leased pub. This would include free-of-tie pubs. As I have already said, the Government do not agree with that approach. There is some evidence of problems in the free-of-tie sector. Some free-of-tie tenants, for example, feel that their property insurance is too high. That is a common issue with commercial leases right across sectors. In the pub sector, by contrast, we have a large body of evidence of problems with tied pub agreements. The Government therefore wish to focus regulation where there is evidence of significant problems, not on the free-of-tie sector. I hope that the Committee will be content to support these amendments. I propose again to listen to noble Lords before responding to the other amendments in this group.

[The Deputy Chairman of Committees (Baroness Stedman-Scott) (Con)]

My Lords, I advise the Committee that if this amendment is agreed to it pre-empts Amendments 91A and 91AZA.

[Lord Howard of Rising (Con)]

My Lords, I wish to speak to Amendment 91D in this group. Its purpose is to remove uncertainty and so give smaller breweries a stable background in which to run their businesses. Helping small business is after all the purpose of the Bill. For these smaller breweries—indeed, for any pub company—to be successful in a declining market, it is essential that they make significant investment in their pubs. This necessary investment is not practical if they do not know under what rules they are operating. My noble friend mentioned changing the figure of 500 by affirmative resolution, but while change by regulation or order goes some way towards parliamentary examination it is, for practical purposes, a rubber stamp. Between 1950 and 2014, only 11 resolutions were rejected in the other place and only five in your Lordships’ House.

For that reason, if the Secretary of State can change the 500-pub definition to a different number by regulation, that will create uncertainty and severely restrict, if not halt, the investment necessary for the survival of the smaller breweries—which, by the way, generally speaking, have been increasers rather than closers of pubs. If noble Lords think that it is overpessimistic to say that investment will dry up, I remind them that under the last change in the rules governing the ownership of pubs many famous names, as my noble friend Lord Hodgson alluded to earlier, such as Whitbread, Bass, Scottish & Newcastle, Courage and Watneys have been absorbed by multinationals. It would be against the spirit of what we are trying to achieve today if a consequence was to contribute to the demise of small breweries.

Any change to the number of 500 should be subject to primary legislation. I urge the Minister to consider the amendment seriously so that those smaller breweries can continue to invest and create the prosperity necessary to maintain that part of the pub sector and help stem the decline of pubs.

--- Later in debate ---

Amendments 91A and 91AZA not moved.

[The Deputy Chairman of Committees]

My Lords, I must advise that if Amendment 91AD is agreed then Amendments 91B to 91CA will be pre-empted.

Amendments 91AA to 91AD

Moved by

Economy: Government Policies

Baroness Stedman-Scott Excerpts

Thursday 24th March 2011 Lords Chamber

[Baroness Stedman-Scott]

My Lords, if anybody had suggested to me 18 months ago that I would be standing here, having been ennobled and making my maiden speech, I would never have believed them. Some noble Lords are worried that I do not know my right from my left and that I may not be sitting on the correct Benches. I have to tell your Lordships that all my political ancestors were Tories. I only know this because a cousin of mine has done our family tree since my ennoblement, and no one was more surprised than I to find that 10 of my ancestors were MPs and two were Barons.

At the outset, I must thank my two sponsors, my noble friends Lady Fookes and Lord Freud. Special thanks must go to my noble friend Lady Fookes; she is my mentor, and her support and counsel have been invaluable to me in acclimatising to the House. I pay tribute to the professional and dedicated members of staff who serve this House. Their help has been much appreciated.

I joined the House with no special qualifications, save that I am the chief executive of an independent charity, Tomorrow’s People. I hope that all your Lordships have heard of it; its mission is to help those furthest from the labour market to get and keep a job. If you can get somebody into a job, that is a good thing and if you can keep them there, that is a truly great thing. We work and support people on a one-to-one basis. We take them on an individual journey and their needs are at the heart of everything we do. In essence, we are more interested in their destiny than their history. Tomorrow’s People has helped me to understand the issues faced by the long-term unemployed in this country and has given me and my colleagues an opportunity to find innovative solutions to their worklessness.

An example of that would be the work that we have done in doctors’ surgeries—indeed, that was adopted by the previous Administration—as well as our work with whole families in which not one member has a job. I remember Dr Roy Macgregor, a GP, asking me what could be done about his “heart sink” patients. I have to confess that it was not a condition I had ever heard of. When I asked him what he meant, he told me, “There are people who come into my surgery and my heart sinks because I can do nothing for them. It is a job they need, not medication”. There is no doubt that, for the majority, work is the best route out of poverty and that we need a vibrant economy to create the jobs that are so desperately needed.

I thank my noble friend Lord Lawson of Blaby for securing this important debate. I am sure that it will come as no surprise to your Lordships to know that there are whole families in this country in which no one is employed. Even in economically successful times, when levels of unemployment were comparatively low, there were still whole households where no member worked. The Office for National Statistics stated in 2009 that there were more than 3.1 million households where no one aged 16 or over was in employment. That is such a waste.

That is why I chose this debate in which to make my maiden speech. The health and vibrancy of our economy is crucial to creating the jobs that are needed. We have to ensure that there is innovation not only in identifying solutions to help people overcome the barriers and issues that they face but in the development of different forms of finance. After all, this all has to be paid for.

I draw noble Lords’ attention to the bonds developed by Allia, where investors can make working capital available in the knowledge that they will be guaranteed to get it back, which I would think was a good thing, and also to the social impact bonds. Time prevents me from going into detail about these two bonds, but they should be given serious consideration. The need for us to help those furthest from the labour market is greater than it has ever been, and we are going to have to turn over every stone to find the resources to ensure that we can help these people in difficult times.

With jobs thin on the ground, it is imperative that we help those furthest from the labour market to manage their period of economic inactivity in such a way that they stay in good shape and can take advantage of the opportunity when it comes so that they are ready and can maximise what is given to them. There will be a cost to this—I understand that it has to be paid for—but the cost will be greater if we stand by and do nothing.

I look forward to working with all noble Lords in this House to try to achieve this, because none of us is as clever as all of us. On entering this House I received a card that read, “Some make it happen, some watch it happen and some ask, ‘What happened?’”. I know where I—and, I hope, all of us—stand in that respect.