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Winter fuel cuts to put 50,000 pensioners in relative poverty
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Winter fuel cuts to put 50,000 pensioners in relative poverty

A further 50,000 pensioners will be living in relative poverty next year as a result of cuts to their winter fuel allowance, the government’s own estimates have revealed.

Earlier this year Chancellor Rachel Reeves announced the £300 payment would be capped for all but the poorest pensioners – those eligible for Pension Credit.

In an attempt to cushion the impact of the cuts, the government has launched a campaign to encourage eligible pensioners to claim Pension Credit.

In a letter clarifying the figures, Work and Pensions Secretary Liz Kendall said the estimates did not take into account any increase in Pension Credit take-up.

She also said that the figures were rounded to the nearest 50,000 and noted that the numbers given for each year should not be added together.

According to estimates provided by the government, there will be 50,000 more pensioners in relative poverty after housing costs in the year ending March 2025, March 2026 and March 2028.

In the year ending March 2027, March 2029 and March 2030, another 100,000 pensioners would be in relative poverty after housing costs, the estimates say.

Currently, the government estimates that 1.9 million pensioners – about 15% – are in relative poverty.

New estimates, published on Tuesday, suggest that cutting the winter fuel payment would increase pensioner poverty by 0.5 percentage points.

A person is considered to be living in relative poverty if they have less than 60% of the average income.

In his letter, Kendall said the Department for Work and Pensions had written to 120,000 pensioners to encourage them to claim the Pension Credit they may be entitled to.

She added that the decision to cut fuel payments for the winter “was not a decision this government wanted or expected to make”.

“However, we have been forced to make difficult decisions to balance the books in light of the £22bn black hole we have inherited.

“Given the dire state of public finances, it is only right that we direct support to those who need it most.”

Helen Whately, the Tories’ work and pensions secretary, said: “Finally the dam is breaking and we can see what Labor has known all along.

“Their winter cuts to fuel will push 100,000 pensioners into poverty over the next few years.

“Clearly Keir Starmer thinks that’s a price worth paying to make a political point. But I don’t think those pensioners would agree with him.”

Daisy Cooper, the Liberal Democrat Treasury spokeswoman, said: “While the Tories have undoubtedly left this government with a terrible fiscal legacy, this is no excuse to push more pensioners into poverty as the temperature drops.”

During a press conference in Brazil, where the Prime Minister is currently attending a G20 summit, Sir Keir Starmer was asked about the figures.

He said the state pension would rise by £470 in the spring and pensioners would be better off.

Earlier in the day, Scottish Labor leader Anas Sarwar he moved away from Sir Keir by pledging to increase pension credit eligibility if they form the next government.