Better-off pensioners should be stripped of taxpayer-funded benefits, says Nick Clegg

Better-off pensioners should be stripped of their taxpayer-funded benefits because they are difficult to justify at a time of widespread spending cuts, Nick Clegg has said.

The Deputy Prime Minister said giving free television licences, winter fuel payments and free bus passes to everyone was increasingly “difficult to explain”.

He called on well-off pensioners to help “make ends meet” by surrendering the handouts, warning it was not fair that Lord Sugar, the tycoon, for example, should be entitled to receive state assistance.

The Liberal Democrat leader pledged to continue to support universal benefits for the elderly, worth hundreds of pounds per person every year, until 2015 but suggested that the handouts are then reconsidered.

A Lib Dem health minister also indicated yesterday that the elderly would face paying higher taxes to fund their care in old age under reforms to be introduced later in the decade.

The Coalition has ruled out the means-testing of so-called universal benefits for the over-65s until at least after the next election. David Cameron is opposed to stripping pensioners of any benefits and is wary of any measures which are seen to be aimed at the elderly.

In an interview at the Lib Dem conference in Brighton yesterday, Mr Clegg said benefits for the elderly should be reconsidered after 2015. The Deputy Prime Minister said: “We have ruled out in the Coalition Agreement changing what are called age-related universal benefits: free TV licences, winter fuel payments and free bus passes.

“My own view is for the future that it would be very difficult to explain – and it would be quite interesting if you could ask the Labour Party this, because they appear to be saying that at a time when people’s housing benefit is being cut, we should protect Alan Sugar’s free bus pass.”

He said the rich should consider surrendering the benefits voluntarily, adding that there were “many millionaires” who might consider giving up some of those universal entitlements “to help some of those who are less lucky than them make ends meet”.

Don Foster, the communities minister, went further than the Lib Dem leader by calling for an immediate end to universal benefits. “It’s not yet Liberal Democrat policy, it’s something we’ll work on,” he said. “But you know, if there is something that can be done now then we need to get the economy moving now, not just to put it in a Liberal Democrat manifesto for 2015. If we can get something like this implemented now, then that would be

better.”

Lord Oakeshott, a Liberal Democrat peer close to Vince Cable, the Business Secretary, added: “I’ve been raising these questions about winter fuel payments going to people who don’t need them, whether they are sipping sangria in the sun in Seville or people like me in their sixties with good jobs: why at least should these not be taxed?

“Nick has bravely taken hits for the Coalition team on tuition fees and the NHS, for example. Why on earth can’t David Cameron at least accept that if we’re all in it together, rich pensioners in good jobs should take the hit too? Why aren’t we fighting for fairness on well-off pensioners’ perks now rather than waiting for 2015?”

In his keynote speech at the conference yesterday, Danny Alexander, the Chief Secretary to the Treasury, also warned that difficult choices over the welfare budget still had to be made.

Iain Duncan Smith, the Conservative Work and Pensions Secretary, is also understood to believe that universal benefits for the elderly should be reconsidered as George Osborne attempts to cut another £10 billion from the welfare budget by 2017. Mr Alexander, the Chancellor’s Liberal Democrat deputy, said: “At £220 billion, welfare is one third of all public spending and despite our painful reforms it is still rising.

“We will have to look at it. But that cannot, must not, and will not be the only place we look. We insist that the difficult choices must be fairly shared: that those who can afford more must contribute more.”

Lord Sugar hit back at Mr Clegg’s remarks. The Labour peer said: “The twit Nick Clegg moaning about me having a bus pass. Idiot, I don’t have one.”

The Coalition is also discussing how to overhaul the social care system, to cap the costs of care for the elderly and stop people being forced to sell their homes.

Norman Lamb, the new minister for care services, said adults of working age could not be expected to cover the rapidly rising cost of supporting the elderly and disabled.

He insisted he was committed to protecting pensioners from “catastrophic” residential care bills that force tens of thousands of people to sell their homes each year and promised reforms “within months”.

However, in a series of fringe meetings at the Lib Dem conference, Mr Lamb said the estimated £1.7 billion a year required to pay care reforms could not be met from within existing budgets.

He said that a “new funding stream” would be needed to pay for capping care costs and it “has to be generationally fair”.

He said: “We can’t expect working-age people who are already under enormous pressure to incur further costs to care for older people.”

The Lib Dem conference in Brighton, which ends today, has been dominated by calls for higher taxes on the rich. Mr Clegg has threatened to block another round of spending cuts without new taxes and levies on the better off.

In his closing speech to the conference today, the Deputy Prime Minister, will say he is “proud of the resolve” shown by the Liberal Democrats in government and that those who continue to oppose his leadership and alliance with the Conservatives have no place in his party.

He will say that the Lib Dems cannot now take the “alluring prospect” of walking out of the Coalition.

“The choice between the party we were, and the party we are becoming is a false one,” he will say.

“The past is gone and it isn’t coming back. If voters want a party of opposition — a ‘stop the world I want to get off’ party – they’ve got plenty of options, but we are not one of them.

“There’s a better, more meaningful future waiting for us.

“Not as the third party, but as one of three parties of government.”

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