Theresa May’s policy and OAPs (old age pariahs)

Theresa May has arrogantly targeted the pensioner for cut upon cut and don’t be misled into thinking it is just the Dementia Tax, that is one of many pensioner cuts.

The latest attack is the Dementia Tax that is explained well by John Rentoul in the Independent here and which today on BBC Sunday Politics Andrew Neil the former Times editor and well known Conservative describes as a 100% tax rate on any asset over £100,000 and given this now but not previously includes your house with the average value being some £216,000 is a significant tax grab.  The media is replete with Conservatives queuing up to attack Theresa My’s Dementia Tax policy see here, here and here among many others, yet her closest political ally in the cabinet Damian Green the DWP Minister has today stated on the BBC Marr Show that the Dementia Tax as it is called remains and will not see a U-turn..

This adds to the abandonment of the triple lock which adds to the 75% cuts to the Winter Fuel Allowance  which adds to the LHA Maxima Cap cut aka the back door pensioner bedroom tax … all of which come on top of £8.6 billion of existing social care cuts since 2010 Labour claim and even the Financial Times says is a 19% cut in social care

It will be a hell of a lot more than 150,000 pensioners who lose out with the cut to 75% of Winter Fuel Allowance and is estimated at 10 million pensioners and all 12 million pensioners will lose out by abandoning the triple lock which becomes a double lock and particularly given rapidly increasing inflation which currently stands at 2.7% and is thirty-five per cent above the Tories 2% target.

The fact that around 500,000 pensioners in general needs socially rented housing are at risk of eviction with the LHA Maxima Cap cut seems insignificant by comparison with the 10 million plus who will lose out due to the abandoning of the triple lock and savage cut to the Winter Fuel Allowance.  Yet the fact that pensioners who are fully occupying their properties in low rent areas such as Hull and many other Northern towns and cities makes their Housing Benefit cuts all the more distasteful and offensive and not even a bedroom tax or spare room subsidy as they don’t have spare bedrooms yet are still cut.

Theresa May and the Tories were overtly targeting the pensioner well before last weeks manifesto which gave the added attacks of the Winter Fuel Allowance, abandoning the triple lock and the Dementia Tax.  In fact, historically, the triple lock for pensioners is not a normal Tory policy at all as the figures below (from official government figures) reveal.

In 1979 Thatcher inherited 58.9% of the social security spend being the pensioner which she reduced to 54.2% by 1983 and still further to 52.3% by the time of the 1987 general election.  Major increased it slightly to 53.6% of all social security spending by the 1992 election but cut it to 50.9% of the social security budget by the 1997 election.

We see a history of the Tories reducing the pensioner welfare spend in short.

By comparison Blair who inherited this 50.9% pensioner social security spend increased it to 56.3% by 2001 and to 64% by 2005 and Blair / Brown increased this further to 65.3% of the total social security spend by 2010.  If you adhere to the argument that buying the pensioner vote is good politics the Blair / Brown years certainly back up that posit.

Cameron clearly liked the posit as he took the inherited 65.3% of all social security spend being the pensioner to 67.02% by 2015 with the triple lock and couple that with a series of social security cuts such as the bedroom tax and the benefit freeze only applying to those below pension age and protecting the electorally sensitive grey vote was clearly a key factor in Cameron’s strategy unlike previous Tory administrations of Major and Thatcher.

We now see Theresa May reverting to more usual Tory policy of reducing the pensioner social security spend like Major and Thatcher.  Recent political history since Thatcher shows the Tories always reduce the pensioner social security spend and so the generous triple lock of Cameron is an aberration compared to normal Tory policy which cuts pensioner benefits … and this time May has gone way beyond this with the Dementia Tax.

The Dementia Tax attacks the pensioner not on social security benefits, those not a financial ‘burden’ on the state and it attacks those pensioners and other older persons who have worked and bought their own properties.  As Andrew Neil said indignantly and correctly this is a stealth inheritance tax on pensioners with a 100% tax rate on any capital, including their home, above £100,000.

In political terms Theresa May has made an almighty cock-up with the Dementia Tax and just as big a cock-up is refusing to reconsider it as her closest ally Damian Green confirmed today on the Marr show.

If only the grey vote knew all of the above eh?



12 thoughts on “Theresa May’s policy and OAPs (old age pariahs)

  1. Scottish pensioners will get hit by the Dementia Tax aka Death Tax too.
    But for some strange reason they won’t be hit by another cut – they’ll keep their Winter Fuel Payment. The Tories have tried some laughable excuses for the reason this cut applies to England, Wales & NI but not to Scotland: “it’s colder in Scotland”. Yeah, right. Carlisle is obviously tropical compared to Greta just across the border!
    Real reason is obviously that race is closer in Scotland & they want to try to steal some SNP votes!

      1. There’s a different Tory manifesto for Scotland. I can’t be arsed to read the whole crappy thing to see if there are other differences, but the para on winter fuel payments is different:

        “We will also maintain all pensioner benefits in Scotland, including free bus passes and TV
        licences for the duration of this parliament. Social security devolution allows us to make
        different choices in Scotland and so we will protect universal Winter Fuel Payments for
        all older people and they will not be subject to means-testing. We will focus on ensuring
        that no pensioner has to live in a hard to heat home in Scotland by the end of the next
        decade through significant investment in energy efficiency.”

        Click to access GE2017_Manifesto_A5_Scottish_DIGITAL.pdf

      2. Yes aware of different manifesto BUT the Winter Fuel Allowance is a welfare benefit policy and (as yet) Scottish government has no powers over UK welfare benefit matters. If the Scottish government do not accept the welfare benefit powers as allegedly offered this means that Scottish government will pay for the WFA in the same way they pay for the bedroom tax now

  2. Joe 

    “The Dementia Tax attacks the pensioner not on social security benefits” Actually Joe….it does. The pensioner living in their own home may well be on social security (if you mean any mtb such as pension credit). They could also be receiving a home care service from the council. They will be assessed to pay the full cost of the service  (say £30 an hour) because the value of their house will be included in the assessment. They obviously can’t afford out of income the £210 a week charge for just one hour a day of home care. So they build up a debt to the council that will keep on increasing at the rate of over £10k a year in this example. This carries on until the debt leaves them with £100,000 nominal ‘floor’ of savings. With a house worth the average £216,000 the pensioner on social security will have a maximum debt of £116,000 that can only be cleared by selling the house once the pensioner dies. If they have just two years of a minimal home care service of an hour a day, the pensioner on pension credit will still owe a staggering £21,000. The only other option for them would be to take out an insurance policy at an earlier age, at astronomical rates of premiums, to pay out in the event of needing home or residential care. Which in fact only 1 person in 6 will need but 6 out of 6 will fear. A nice windfall for the insurance industry.  Sent from my Samsung device

    1. You misread and misinterpret what I said.

      When I said ““The Dementia Tax attacks the pensioner not on social security benefits” that means it attacks ALL pensioners not just those on benefit

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