UK Politics

Lib Dem conference: 'Millionaire' pensioners may face benefit cuts

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Media captionLib Dem leader Nick Clegg says there is "a debate to be had" with regard to age-related universal benefits

The Liberal Democrats are looking at curbing all age-related universal benefits for pensioners with assets of more than £1m.

The changes could affect payments including winter fuel allowances, free TV licences and bus passes.

Nick Clegg said the welfare budget "cannot be immune" from efforts to find government budget savings after the next general election in 2015.

But Lib Dem minister David Laws said he was "sceptical" about the proposals.

The proposals could form part of the party's manifesto. They would not come into force during the current coalition government, as it is a party, rather than a government, matter.

The changes, if implemented, would come in after the next general election, after the 2015-16 spending round.

Opening debate

Asked whether the welfare budget could be ring-fenced from the debate on future savings, Mr Clegg told the BBC that "it can't remain immune".

Mr Clegg said age-related universal benefits such as free bus passes, winter fuel payments and TV licences for well-off pensioners would be protected for the duration of the current Parliament.

But he suggested the debate may have to be reopened for such entitlements after this period.

"I think there are many millionaires in this country... will also say voluntarily that maybe they should give up some of these universal entitlements to help people who are less lucky than them to make ends meet," he told BBC Radio 4's the World at One.

He added that it was "very difficult to explain... at a time when people's housing benefit is being cut that you should protect Alan Sugar's free bus pass".

The government has made clear the size of the deficit means there will have to be further cuts after the next election - scheduled for May 2015.


But a Lib Dem minister has gone further and said universal benefits should be taken away from the better-off much earlier.

Don Foster told the BBC the coalition should examine their future in the next spending round - covering 2015-16 - which has to save £16bn

People like him should not be receiving benefits such as the £200 a year winter fuel allowance, he suggested.

"It's not yet the Liberal Democrat policy, it's something we will work on," he told BBC Radio 5Live.

"But if there's something that can be done now then we need to get the economy moving now and not just put it in the Lib Dem manifesto for 2015".

However, another senior Lib Dem, education minister David Laws, said: "I don't think anyone is suggesting we should be sending out leaflets to pensioners asking them to declare their jewellery or their property... We have no intention whatsoever of doing anything like that.

"To be honest, I'm sceptical of this personally because the amount of money you would actually save by taking away some of these benefits from very rich pensioners is not huge because there are not many very, very, very rich pensioners."

The Conservatives have pledged to retain universal age-related benefits for the lifetime of the Parliament.

Lib Dem sources said the details of how they would calculate the £1m threshold above which benefits would not be paid were still being clarified.

They said the "net worth" of an elderly person could be the value of the house, or income or size of pension pot.

Earlier, Treasury Secretary Danny Alexander said welfare would be one area "looked at" for savings in the next spending round up to 2016 but insisted the process would be as fair as possible.

"Welfare cannot, must not, and will not be the only place we look.

"We insist the difficult choices must be fairly shared: that those who can afford more must contribute more."

Meanwhile, The Lib Dem leadership has been defeated over plans for "secret" court hearings in some terrorism cases.

Activists backed a motion opposing plans to allow intelligence evidence to be heard behind closed doors, despite the government arguing it was necessary for security reasons.

Instead members called on Lib Dem MPs to press the coalition to drop the proposed changes in the Justice and Security Bill.

A compromise motion allowing cases to be heard in private "only as a last resort" was defeated.