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Government may make cuts to child benefit and winter fuel allowance

Date: 23 August 2010


Recently, the coalition government has come under criticism for their ambiguous plans to reduce and even scrap many benefit schemes, such as child benefit and the winter fuel allowance. Nick Clegg has responded by saying that no final decision had been made yet.

Ministers have already agreed to raise the age at which the winter fuel allowance is available to 65 from 60 by 2020. Reports suggest that also being considered is a means-tested approach for child benefit, with the possibility of parents in the top tax bracket being made ineligible. Child benefit is paid at the rate of £20.30 a week for the first child and £13.40 for other children, costing about £4.3bn a year.

The winter fuel allowance scheme introduced by Labour meant that pensioners could still heat their homes without the worry of energy bills. At the moment anyone over 60 is eligible, receiving £250 pounds towards their fuel with over 80s getting £400 towards the bill. This costs the taxpayer £2.7bn and the Government is planning to cut the fuel allowance by as much as £100 according to The Times and The Daily Telegraph.

Last winter 36,700 pensioners died of cold related illnesses, working out to a shocking 13 pensioners dying an hour, and according to Dot Gibson, general secretary of the National Pensioners Convention, the Government’s decision to stop this plan “will only make matters worse”.


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Interesting Fact

Child Tax Exempt Savings Plans (TESPs) are an efficient and simple way to save for your child, and Shepherds Young Saver Plan lets you put away more per month than any other TESP.

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