Margaret Thatcher’s 1971 decision to stop the provision of milk for junior school pupils when she was education secretary in Ted Heath’s government was prompted by her desire to spend the savings on schoolbooks instead.
No one remembers that detail. Instead, the issue became totemic and while she only saved £9m at the time – or £112m in today’s prices – it earned her the playground nickname “Thatcher, Thatcher, milk snatcher”.
I’d thought the taunt had died with the former prime minister, but a voter mentioned it only a fortnight ago during an interview in Runcorn and Helsby ahead of the by-election. The woman in her fifties can only have had the haziest memory of ever drinking from the glass bottles with shiny silver tops – lukewarm in summer and frozen in the winter – but she described how her family had never trusted the Conservatives again after the milk was taken away.
It shows the danger of removing a benefit that people have got used to, even if the money can arguably be better spent elsewhere or to fill a fiscal hole. It’s a lesson Labour has learned the hard way from last week’s local election results after losing around two-thirds of the council seats it was defending.
Taking away the universal benefit of the winter fuel allowance, effectively a pension top-up, has now become a simple, key takeaway symbol of a governing party who are targeting the vulnerable, even if by other measures some pensioners are historically better off.
Last year the state pension went up by 8.5 per cent, an annual rise of £691.60 for those on the full basic state pension or £902.20 for those on the full new state pension. This year state pensions are going up by 4.1 per cent – a rise of £363 a year for those on the basic pension or £472 for those on the new pension, with the triple lock ensuring an above-inflation rise, not something that can be said for the whole of the workforce.
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Read MoreLast year, the Government decided to restrict the winter fuel allowance payments to those who qualify for pension credit and other income-related benefits, in a bid to save £1.4bn. The move, which did not feature in Labour’s election manifesto, means around nine million pensioners will no longer qualify for the top-up.
“The problem with it is it isn’t only about winter fuel. People have got it in their mind that you’ve come for winter fuel, so you’ll come for something else next. Pensioners are not going, ‘Ok, on the one hand, I’ve lost £200, but I probably gained even more from the triple lock than that.’ People just don’t see it,” according to one Labour MP who spent last week on the campaign trail. “It came up everywhere.”
Following The Guardian’s report about a possible review of the policy – a key reason cited by voters for not supporting Labour in last week’s local elections – overnight No 10 denied any formal review. On the breakfast broadcast round, Health Secretary Wes Streeting deliberately dodged questions about the possibility of reconsidering the policy. He said ministers are “reflecting on what the voters told us”. The Government’s position later became fixed when the PM’s spokesperson declared at the noon Downing Street briefing that the policy was unchanged.
It’s a sign that those at the top of Government who floated the idea are well aware of how totemic it has become, only to come crashing up against the reality of all the other savings that have to be made too. From a fiscal perspective, it’s a relatively small matter, but politically and reputationally, it’s proven to be far larger than the Government predicted.
Instead, Downing Street went out of its way to point out how well pensioners are faring under this Government and say the decision was taken to balance the books. Sir Keir Starmer’s spokesman insisted that millions will see their state pension rise by £1,900 by the next election through the commitment to the triple lock. They also pointed out how there had been a rose in applications for pensions credit and a boost to the household support fund with over £400m to ensure local authorities can support vulnerable people and families.
Government sources say that the Department for Work and Pensions modelling of savings from scrapping the universal winter fuel payment took into account the fact that pension credit claims would likewise increase by around 100,000. Even tweaking the threshold now would risk wiping out the savings made from the policy.
According to an analysis of DWP figures, in the 16 weeks after the announcement last July the Government received around 150,000 claims, compared with 61,300 in the 16 weeks before. However, many of those new claims were rejected – the number of pension credit claims actually awarded increased by 17 per cent, from 36,400 to 42,500. But the number of rejected claims rose by a whopping 96 per cent – from 27,100 to 53,100. The newest figures aren’t yet available but that is a lot of pensioners feeling the pinch.
Inside the Labour Party the issue of the winter fuel allowance has become emblematic for a different reason. “I think people feel that sometimes decisions are being taken without looking at what the full consequences of some of those decisions are. Look at winter fuel. Look at the damage that’s done for basically sod all. You can’t say ‘this has delivered so much money; we can do something dramatic with child poverty or build more houses’. It’s saved thruppence ha’penny for a load of distress and grief,” another Labour MP told The i Paper.
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Read MoreLabour Welsh First Minister Baroness Eluned Morgan, staring down the barrel of a Reform UK or Plaid Cymru walkover at Senedd elections next year, called on the UK Government to “rethink” the policy in a speech on Tuesday, adding that it “comes up time and again” with voters. But her call was rejected when Starmer’s press secretary said his administration will not be “blown off course” after the local election results. “We were elected as a stable and serious party after 14 years of chaos and decline.”
Morgan also said the UK Government’s welfare reform proposals “are causing serious concern here, where we have a higher number of people dependent on disability benefits than elsewhere”.
The complaint about pending welfare cuts also featured on the doorsteps of the English local election campaign. “We haven’t properly set out all the welfare changes yet so people think we are going to take their PIP [personal independence payments] away even if they’re obviously going to keep them; they’re scared of what we will do,” the second Labour MP added.
Thatcher was so bruised by the political reaction to cancelling free school milk that nearly 20 years later, as prime minister, she blocked her then health secretary Ken Clarke from ending free milk for nursery schoolchildren as well.
As the fallout from the local elections continued to dominate Westminster chatter on Tuesday, one Tory half-heartedly suggested, “Starmer, Starmer, Granny-Harmer”, testing out a phrase they knew wouldn’t fly. The farmers got there first after changes to their inheritance tax and bagged the best rhyming insult with: “Keir Starmer: Farmer Harmer”.
The coalition of voters that delivered Starmer a massive parliamentary majority only 10 months ago is already fracturing. Labour insiders know Starmer risks being defined by a policy delivered just three weeks after a landslide victory.
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