Means Testing the Winter Fuel Allowance?

Today, I'm going to look one of the more forgotten about Labour policies- means testing winter fuel allowance. Means testing the winter fuel allowance sounds like a masterstroke- there are rich old people out there who don't need it and, in our age of austerity, it sounds like common sense. It seems as though it's the perfect solution- those in real fuel poverty would continue to receive help, where those who don't need help would not receive it. But would it work?



To make means testing work, you first must ask 'how much wealth makes you rich?'. Depending on people’s circumstances; where they live and how large their non-liquid assets are worth or cost to run, saying 'being this wealthy means you don't need winter fuel allowance' will put some who don't need it within the boundary and vice versa. Actually figuring out how to means test the winter fuel allowance might well be the hardest part. 




You also have to remember one of the biggest problems with means testing in the benefit system: people don't know they are entitled to them, or they don't want to be a burden. These are often the very people these benefits were designed to help. The elderly are the worst for not applying for these benefits, either out of pride and maintaining the notion of self reliance, a reluctance to take a (often longer) time to apply, not knowing how to apply, or simply not knowing about the full range of benefits available. Means testing might well mean the winter fuel allowance becomes significantly less effective at doing the job it's supposed to do.



And most importantly, there's a somewhat confusing and cripplingly important question still to answer: 'how much money would this actually save?'. It sounds clear cut, and many people have assumed it is, but when you're forced to means test suddenly the administration of the benefit becomes significantly more expensive. Depending on where the line is drawn, it could even end up costing more to means test than to not means test the winter fuel allowance. It certainly won't solve the budget problems some people assume it will, and any saving a lot smaller than what you might expect.




All in all, it seems like a bad idea. An almost unworkable scheme that wouldn't save much (if any) money. It could make good politics, but wouldn't make a good policy.