04 July 2007
The Council of Ministers today lodged proposals which meet the States decision to introduce a Winter Fuel Payment Scheme from January 2008.
The proposal is an addition to the new Income Support benefits system, and provides a solution to the States call for reallocation of funds to allow a Winter Fuel benefit to be introduced.
The States had originally charged the Council of Ministers to come up with a blanket scheme to benefit all pensioners, regardless of their needs or income levels.
A wide-ranging scheme, which was not means-tested, would cost Jersey around £2.5m each year. After consideration the Council of Ministers agreed that if a scheme is to be introduced any available funds should be used to help those in need.
The scheme which Ministers are presenting to the States would pay winter fuel allowances to families on Income Support which include someone aged over 65, a child under 5 or a household member with a significant disability.
The payment would be paid in periods of cold weather and would be delivered with regular Income Support payments.
The estimated cost of providing this scheme is £560,000 per annum. Many options for raising this additional sum were considered by Ministers, including cutting services in all States departments. Ministers decided that if such a scheme must be introduced, then it would be fair to start to means test the annual Christmas Bonus, introducing an income bar, as already agreed by the States in 2004 but never enacted. The Christmas Bonus currently costs Jersey £1.5m, but by restricting payment to pensioners in financial need, there would be an annual saving of £400,000 per annum, which would underwrite the payment of a winter fuel subsidy.
The Council of Ministers also agreed that the Christmas Bonus should in future only be paid to pensioners aged 65 and above, rather than – as happens now - to some women receiving it at 60 and certain men at 63.
This would not be enacted retrospectively, but once existing recipients had all reached 65 and over this is expected to save £180,000 pa.
A further change proposed will see the Christmas Bonus only paid to those pensioners resident in the Island in the future.
Senator Routier, the Minister for Social Security said “The Council thought long and hard over the proposal set by the States to introduce a Winter Fuel Scheme and decided that as it had to be met by cuts to services, then the scheme should be targeted at those most in need and that the most appropriate place for such a scheme would be within the Income Support system, which is also directed at real need. In that way, we will maintain the even-handed approach which we believe is fair and equitable and we would not be using taxpayers’ money to provide subsidies to people who are not in any financial need.”
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