The Institute for Fiscal Studies has previously calculated the savings to the Treasury of means testing universal pensioner benefits (free TV licence, free bus pass, winter fuel allowance) would be £1.4 billion per year:
– The Institute for Fiscal Studies
One way of raising revenue to pay for the Dilnot Commission proposals on social care by taking money from richer pensioners would be to means- test these benefits. Restricting Winter Fuel Payment and free TV licences to those on Pension Credit would save around £1.4 billion a year.
Nick Clegg will also set himself apart from David Cameron today over the issue of benefits for better-off pensioners.
It will be a departure from the Coalition Agreement which promised to stick by the universal winter fuel payments, free TV licences and free bus passes during this Parliament.
But Mr Clegg will say that he will be developing proposals which make clear "money should not be paid to those who do not need it" and the Coalition should be "looking again at universal benefits paid to the wealthiest pensioners."
Nick Clegg's speech will contrast with that of the Chancellor's. George Osborne said the Government should be there for the "strivers" and not "shirkers". But the Deputy Prime Minister will accept that not everyone who cannot find a job is simply being lazy:
"Of course, there are some on the right who believe that no-one could possibly be out of work unless they're a scrounger... The siren voices of the Tory right who peddle this myth could have pulled a majority Conservative government in the direction of draconian welfare cuts."
Nick Clegg will emphasise today that welfare reforms have not been forced on to his party by the Conservatives:
It was in our manifesto and on our agenda right from the start. The Liberal Democrats are now the party of welfare reform - sensible, centre ground welfare reform. I want us to keep at the front of our minds the idea that a liberal state is an enabling state. Some conditions are so common that we simply cannot write sufferers off and pay them to stay at home.
It is time for politicians and the benefits system to recognise that people with health conditions have just as much potential as everyone else if only they are given the help they need to get on.
- In his address today Nick Clegg will acknowledge that governing in difficult times meant his party had acquired a "harder edge"
- But the Deputy Prime Minister will add that the alternative is "a retreat to the comfort and relative irrelevance of opposition"
- With the welfare system they inherited from the former Labour government Mr Clegg will say the coalition had no choice but to carry through major changes because it was both "badly designed and financially unaffordable".
Nick Clegg will mount a vigorous defence of the coalition's welfare reforms today on the eve of the fifth anniversary of his election as party leader. His speech comes at a difficult moment for the Lib Dems with polls showing them slumping to fourth place behind the UK Independence Party.
The Deputy Prime Minister will insist the Government has an "absolute duty" to ensure the system is fair to all. Mr Clegg will acknowledge the changes have, at times, been "painful and controversial".
But he will add that without reform, there is a risk of a "total collapse" in public support for the whole principle of welfare.