Iain Duncan Smith urges wealthy elderly to 'hand back' benefits

Iain Duncan Smith Iain Duncan Smith said the wealthy elderly have a choice as to whether to hand back some of their benefits

Wealthy elderly people who do not need benefits to help with fuel bills, TV licences or free travel should return the money, the work and pensions secretary says.

Iain Duncan Smith told the Sunday Telegraph he would "encourage" people who do not need such financial support "to hand it back".

But the decision whether or not to do so was up to them, he added.

Deputy PM Nick Clegg said the suggestion did "not make sense".

Prime Minister David Cameron has already said the benefits would be protected for the entirety of this Parliament, including for the year 2015-16.

A general election will be held in 2015, and Mr Duncan Smith said there were no plans to means test to exclude richer pensioners.

He told the paper: "I have no idea what we will put into the manifesto... I have no indication of change.

"It's fair to say that [pensioners] are more vulnerable than others and we need to be very careful about what and when we do things, if we ever do."


Money is tight, savings are being made across government, but Sir Mick Jagger is entitled to a free bus pass.

If you think that is odd, some in government agree with you, including the cabinet minister responsible for benefits, Iain Duncan Smith.

But the prime minister has repeatedly committed himself to protecting universal benefits for pensioners, regardless of their wealth.

So Mr Duncan Smith is trying to square the circle.

His idea creates an image of a queue of pensioners posting banknotes through the Treasury's letterbox. Don't hold your breath for that.

And his cabinet colleague Ken Clarke acknowledged there was no mechanism for people to repay the government.

In short, bus passes, free TV licences and winter fuel payments are safe until the next election. But after that, all bets are off.

Among the benefits is the winter fuel allowance of between £100 and £300 tax-free to help people who have reached the state pension age with heating bills.

A free TV licence, worth £145.50 for a colour set, is provided for people aged 75 or over, while those aged over 60 can get free NHS prescriptions.

Eligible older people are entitled to free off-peak travel on local buses anywhere in England when they reach the state pension age. Schemes in Scotland, Wales and Northern Ireland allow people aged over 60 to apply for free bus travel.

A Department for Work and Pensions spokeswoman said people have always been able to contact the department if they no longer want to receive a benefit.

Mr Clegg said his Liberal Democrat party and coalition partner the Conservatives were at odds over pensioner welfare reform: "I think we should grasp this nettle. The Conservatives don't want to do so. That is a difference of approach."

He added: "When money is tight, you've got to have the right priorities in tough times. I think it's right to ask very wealthy, maybe multi-millionaire, pensioners to make sacrifices, just as we're asking families on lower incomes."

Election promises

Shadow communities secretary Hilary Benn said: "I don't agree with him (Mr Duncan Smith).

"The fact is we have certain universal benefits in our society, people have worked hard, they've paid their taxes and they get that, in this case, when they have retired."

Nick Clegg says there is a "difference of approach" between Conservatives and Liberal Democrats over plans for welfare reform

Entrepreneur Lord Sugar and nightclub owner Peter Stringfellow have been among those who have previously complained they have not been able to opt out of receiving the winter fuel allowance.

Former Conservative Chancellor Ken Clarke said: "Well, you can't hand it back to the government, I don't think it's a system for doing that.

"I think every pensioner and retired person, like myself, obviously has to make up their own mind about whether they really need it and whether they're going to give it to some worthwhile cause.

"No doubt, most pensioners who are reasonably prosperous give quite a lot of money to charity and worthwhile causes in any event."

Charity Age UK said encouraging wealthy people to give up the benefits could have a knock-on effect.

"It is open to anyone to decide not to make use of these benefits but when it is suggested that 'wealthier pensioners' should choose to forego them our worry is that some who are badly in need of extra help will feel less inclined to take it," director of external affairs Caroline Abrahams said.

"Older people on very low incomes sometimes minimise their own difficulties and refer to others they know who are worse off than they are."

Universal credit

Meanwhile, the introduction of a new system of benefits for working age people begins on Monday - and marks the biggest overhaul of the benefits system since the 1940s.

Pensioner Ann Davis: "I think they should give us the option to opt out"

Mr Duncan Smith said the new universal credit system was being implemented over four years because "I want to get these things right".

Under the new universal credit, six working-age benefits - income-based jobseeker's allowance, income-related employment and support allowance, income support, child tax credit, working tax credit and housing benefit - will be merged into one.

He said: "We want to say to people, you're claiming unemployment benefit but you're actually in work paid for by the state: you're in work to find work. That's your job from now on: to find work."

Universal credit starts on a limited basis on Monday for new claimants, who are single, who live in a small number of postcode areas in Ashton-under-Lyne in Tameside, Greater Manchester.

Trials in three more areas - Oldham, Wigan and Warrington - will begin in July.

From October, more claimants will move on to universal credit as and when they have a significant change of circumstances, such as starting a new job or when a child is born.

From April 2014 until October 2017, the rest of those affected in England, Scotland and Wales will be moved on to universal credit in stages. It will start in Northern Ireland from April 2014.


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  • rate this

    Comment number 816.

    On the subject of benefits, my partner asked about her pension last week, public sector, although not nearly as many years as my private pension, and about 1/3 part time. My annual report came through Saturday. she has 3 times the pension I'll get, pro rata if she were in my private sector fund, she would need over 200 K to provide it - I'm stunned - what must MPs & Mandarins get?

  • rate this

    Comment number 815.

    Were I in that position, I would regard it as a minor rebate on an otherwise usery tax cumulative tax rate (VAT + income = 56 % tax rate and below pension age, and with NI this used to be 61%).

    Those that begrude these payments should remember who is paying most of the country's tax take in the first place.

  • rate this

    Comment number 814.

    Steve Jobs famously only paid himself $1 a year, as he was already rich.
    IDS, take note!

    If the salaries of MP's was reduced to minimum wage, we'd soon see who genuinely wanted to serve the country, and who was fastest out the door!

  • rate this

    Comment number 813.


    "...politicians should not have gold-plated pensions..."


    What do you mean by "gold-plated"?

    There was a time in the UK when many, if not most employees, in reputable concerns had defined benefit pensions.

    However, anti-union laws meant many people were soon deprived of them.

    That's not a reason why everyone should lose them: politics of envy.

  • rate this

    Comment number 812.

    Why have a go at pensioners, what about the wealthy bankers and their bonuses, what about wealthy MP's and their obscene expenses.

  • rate this

    Comment number 811.

    I am a widowed pensioner, my husband died before he got his pension he worked for all of his life, I do get winter fuel allowance even though its a help I give the money I receive for the allowance to my very low paid son to help pay for his winter bills and so gladly, so if rich pensioners did the same ie give to struggling families it would be the best thing to do the money

  • rate this

    Comment number 810.

    I am the only one to see the irony in a lot of the OAP posts who complain about "scroungers" and then in the next sentence talk about their "entitlement" ?

  • rate this

    Comment number 809.

    "801.Bill Nelson
    Just now
    Wakey Wakey....is anything in there?
    UK the shaft...ops tax capital of the world"

    Wrong, the UK hands out too much in benefits and doesn't collect enough in taxes. Basic maths will tell you that.

  • rate this

    Comment number 808.

    If you are 'rich' and have worked, paid tax and not claimed benefits are you entitled to free cash later on because you deserve it/have earned it?

    Or should that money go to people who actually need it? Morally I think the latter, HOWEVER, I also think there are far too many in this country who abuse the welfare system as a whole and this won't change until governments get tough.

  • rate this

    Comment number 807.

    Just listening to my son play with his toys, "London Bridge is falling down" playing through a tacky piece of plastic. Combined with reading some of these comments, I can't help but feel that it fell down a long time ago. Especially those comments based around political leanings...humanity before ideology. We might be better off if more people tried that.

  • rate this

    Comment number 806.

    What would really appeal to me would be a set of boxes on my tax form that allowed me to direct my taxes directly to the places where I thought my taxes would be best spent like infrastructure, NHS, etc. Then I would be more than happy to give up my bus pass and winter fuel allowance.

  • rate this

    Comment number 805.

    He has also designed the IT system to manage the repayments.
    When this fails it will create lots of Hi-tech IT jobs, and highly paid consultancy jobs. This activity will generate economic growth.
    Joined up policy, knotted together!
    He is also planning a new policy to get his fat cat city friends to repay
    the bonuses and unpaid tax money that they don't need.
    Eureka Ian, who needs Archimedes.

  • rate this

    Comment number 804.

    It is comments like this from IDS, the counsellor in Sussex who didn't want ethnic children near him, the nimbys with the windfarm protests that show the Conservative party to be one entirely based on self interest. All they can do is throw a few bones to the middle classes in terms of tax rebates and pander to the right wing on the EU. Disgusting. I've lost all faith in them.

  • rate this

    Comment number 803.

    Would I D S give back what he gets as an M P as so called expenses, because him being one the rich people he shouldn't need any extra for performing his duties....

  • rate this

    Comment number 802.

    Whats wrong at the beeb?

    UKIP are very dangerous and nationalistic yet no comment from our truth guardians. If they had any semblance of power then old folk would not have the option regarding benefits. UKIP would just remove them.

    Very concerned about the rise of this right wing party. In hardship people turn to strange bedfellows and UKIP are there to fill the void. Be afraid, be very afraid.

  • rate this

    Comment number 801.

    Wakey Wakey....is anything in there?
    UK the shaft...ops tax capital of the world.

  • rate this

    Comment number 800.

    I work in the financial industry where I hear about older people's 2nd homes abroad, private pensions, giving surplus cash away to children etc. Whilst this is laudable, and they've obviously worked hard for this, I agree with IDS that some of their wealth should be redistributed to OAPs who possibly cannot afford 2nd homes etc. Its not rocket science, but I would give everyone a Freedom Pass.

  • rate this

    Comment number 799.

    Another nasty and sneaky attempt to set person against person and to dismantle the welfare state.

    ALL benefits have to be claimed; if you don't want benefits, including the state pension, don't claim them.

    With universal benefits we act as one society, with money being redistributed from the privileged rich through the tax system.

    Ultimately, IDS wants the opposite. He should be imprisoned.

  • rate this

    Comment number 798.

    Ludicrous - if you create benefits so such that people qualify for them, why shouldn't they receive them?

  • rate this

    Comment number 797.

    And MP's should be on minimum wage (obviously with expenses paid)... but that's never going to happen either, is it?


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