Why Labour must defend universal benefits for pensioners

The party should remember that benefits for the poor end up being poor benefits.

One of the suggestions that Tony Blair makes in his piece for the centenary edition of the New Statesman (180 pages, out today) is that Labour should look again at "the right balance between universal and means-tested help for pensioners". It's an argument that's made with increasing frequency as the coalition's welfare cuts bite. While dramatically reducing support for working-age claimants, Cameron has "triple-locked" the state pension (so that it increases each year by average earnings, the rate of inflation or 2.5%, whichever is highest) and protected universal benefits for the elderly such as the Winter Fuel Allowance, free TV licences and free bus passes.

With pensioners accounting for 42.3% of all welfare spending (a total that will continue to rise with an ageing population), an ever greater number of politicians and commentators argue that this settlement is unsustainable. Nick Clegg has called for pensioners' benefits to be means-tested, while Iain Duncan Smith has hinted that he believes David Cameron should not repeat his 2010 election pledge to protect them. As Labour seeks to win credibility on welfare and deficit reduction, Ed Miliband is being urged to abandon his long-standing support for universalism and announce that he would restricit benefits if he becomes prime minister. 

It is right to highlight Cameron's cynicism in protecting pensioner benefits. As the decision to means-test child benefit shows, the Prime Minister has little regard for the principle of universalism. The move was motivated by raw political calculation: pensioners are more likely to vote than any other group (76 per cent did in 2010, compared to 65 per cent of the population at large) and are notoriously vigorous in defending their interests. But there are strong principled and practical reasons why Labour should be wary of joining the coming war against universal benefits.

A new system of means-testing would be complex and expensive to administer, while affecting only a fraction of pensioners. Of the UK's 11 million over-65s, two million live in poverty and another six and half a million have an income below £10,500. Just 200,000 earn enough to pay the 40p rate of tax, meaning that any savings would be largely symbolic. Clegg complains that "we are giving free bus passes and TV licences and winter fuel payments to Alan Sugar", while forgetting how rare the likes of Sur Alan are.

The government currently spends £2.2bn a year on winter fuel payments, £1bn on free bus passes and £600m on free TV licences. Compare that to the £23.8bn annually spent on housing benefit (owing to extortionate rents and substandard wages) and the £27.2bn spent on tax credits (owing to inadequate pay) and it becomes clear where the real savings are to be made. It makes little sense to target benefits for cuts when £70bn a year is still lost to tax evasion, £25bn to tax avoidance and the highest earners (including some of those dreaded "millionaire pensioners") have just received a £1bn income tax cut. By insisting that the welfare state (or at least part of it) should bear the brunt of austerity, the left is playing Osborne's game. 

The great practical advantage of universal benefits is that they ensures support goes to those who need it. At present, 1.8 million elderly people eligible for the means-tested pension credit do not claim it due to the complexity and invasiveness of the application process. In the case of the winter fuel payment, restricting the benefit would risk an increase in the 25,000 pensioners who die every year as a result of cold-related illnesses. 

The left most of all, should be wary of abandoning the principle of universalism. History shows that a narrower welfare state soon becomes a shallower one as the politically powerful middle classes lose any stake in the system and the poor are stigmatised as "dependent". The "paradox of redistribution", as social scientists call it, is that provision for some depends on provision for all. A Fabian Society study of 11 OECD countries found that greater means-testing led to increased levels of poverty as the value of benefits progressively withered. In the UK, we are already witnessing this phenomenon at work. While removing child benefit from higher-earners (a measure defended by Beveridge’s ostensible heirs, the Liberal Democrats), the coalition has simultaneously frozen it in cash terms for three years, a real-terms reduction of £1,080 for a family with two children. As Richard Titmuss observed more than forty years ago, "services for the poor end up being poor services". 

The logic of means-testing is remorseless. Remove winter fuel payments and free bus passes from well-off pensioners and the right will next ask why they should not be charged to use the NHS. Fortunately, as a principled social democrat, Ed Miliband has long recognised such arguments. Challenged over his support for universal pensioner benefits on The Andrew Marr Show in January, he replied: 

Look, if you’re saying to me we should make everything in our society means tested - in other words it shouldn’t be universal - that would include child benefit, the health service, the old age pension. Well that isn’t the road I want to go down. Why is that? Because I think everybody as part of the foundation of being a citizen of the country is entitled to some basic things, including on the basis of having children, needing free healthcare.
But as Labour's policy review continues, pressure will grow on Miliband to reverse his stance in order to prove that the party is "tough" on the deficit and welfare spending. He should resist such short-term maneouvres. The principle of universalism is too valuable to be traded in a foolhardy (and likely doomed) attempt to appease the austerity lobby. 
Tony Blair with Ed Miliband during a service to mark the Queen's Diamond Jubilee at Westminster Hall on March 20, 2012. Photograph: Getty Images.

George Eaton is political editor of the New Statesman.

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Let's face it: supporting Spurs is basically a form of charity

Now, for my biggest donation yet . . .

I gazed in awe at the new stadium, the future home of Spurs, wondering where my treasures will go. It is going to be one of the architectural wonders of the modern world (football stadia division), yet at the same time it seems ancient, archaic, a Roman ruin, very much like an amphitheatre I once saw in Croatia. It’s at the stage in a new construction when you can see all the bones and none of the flesh, with huge tiers soaring up into the sky. You can’t tell if it’s going or coming, a past perfect ruin or a perfect future model.

It has been so annoying at White Hart Lane this past year or so, having to walk round walkways and under awnings and dodge fences and hoardings, losing all sense of direction. Millions of pounds were being poured into what appeared to be a hole in the ground. The new stadium will replace part of one end of the present one, which was built in 1898. It has been hard not to be unaware of what’s going on, continually asking ourselves, as we take our seats: did the earth move for you?

Now, at long last, you can see what will be there, when it emerges from the scaffolding in another year. Awesome, of course. And, har, har, it will hold more people than Arsenal’s new home by 1,000 (61,000, as opposed to the puny Emirates, with only 60,000). At each home game, I am thinking about the future, wondering how my treasures will fare: will they be happy there?

No, I don’t mean Harry Kane, Danny Rose and Kyle Walker – local as well as national treasures. Not many Prem teams these days can boast quite as many English persons in their ranks. I mean my treasures, stuff wot I have been collecting these past 50 years.

About ten years ago, I went to a shareholders’ meeting at White Hart Lane when the embryonic plans for the new stadium were being announced. I stood up when questions were called for and asked the chairman, Daniel Levy, about having a museum in the new stadium. I told him that Man United had made £1m the previous year from their museum. Surely Spurs should make room for one in the brave new mega-stadium – to show off our long and proud history, delight the fans and all those interested in football history and make a few bob.

He mumbled something – fluent enough, as he did go to Cambridge – but gave nothing away, like the PM caught at Prime Minister’s Questions with an unexpected question.

But now it is going to happen. The people who are designing the museum are coming from Manchester to look at my treasures. They asked for a list but I said, “No chance.” I must have 2,000 items of Spurs memorabilia. I could be dead by the time I finish listing them. They’ll have to see them, in the flesh, and then they’ll be free to take away whatever they might consider worth having in the new museum.

I’m awfully kind that way, partly because I have always looked on supporting Spurs as a form of charity. You don’t expect any reward. Nor could you expect a great deal of pleasure, these past few decades, and certainly not the other day at Liverpool when they were shite. But you do want to help them, poor things.

I have been downsizing since my wife died, and since we sold our Loweswater house, and I’m now clearing out some of my treasures. I’ve donated a very rare Wordsworth book to Dove Cottage, five letters from Beatrix Potter to the Armitt Library in Ambleside, and handwritten Beatles lyrics to the British Library. If Beckham and I don’t get a knighthood in the next honours list, I will be spitting.

My Spurs stuff includes programmes going back to 1910, plus recent stuff like the Opus book, that monster publication, about the size of a black cab. Limited editions cost £8,000 a copy in 2007. I got mine free, as I did the introduction and loaned them photographs. I will be glad to get rid of it. It’s blocking the light in my room.

Perhaps, depending on what they want, and they might take nothing, I will ask for a small pourboire in return. Two free tickets in the new stadium. For life. Or longer . . . 

Hunter Davies is a journalist, broadcaster and profilic author perhaps best known for writing about the Beatles. He is an ardent Tottenham fan and writes a regular column on football for the New Statesman.

This article first appeared in the 16 February 2017 issue of the New Statesman, The New Times