The chancellor has faced down would-be rebels in a private meeting of Labour MPs ahead of the crunch vote on the government’s controversial plan to scrap the winter fuel allowance.
Rachel Reeves told a gathering of the parliamentary Labour party that the move was necessary, despite fears about the impact on millions of less-well-off pensioners, as it would help to plug a £22bn gap in the public finances.
She also warned that there would be more difficult decisions to make on the economy, despite dozens of Labour MPs considering abstaining in Tuesday’s vote to cut the £300-a-year payment for all but the poorest pensioners.
A Treasury source said there would be no further mitigations to ease the cuts coming before the vote tomorrow. There were “no plans” for any additional help for pensioners beyond the increase via the state pension triple lock and maintaining the household support fund, the source said.
Government insiders ruled out any prospect of the Treasury offering any concession on the policy, despite the depth of concern from figures across the party. Many MPs are worried that elderly constituents just above the threshold will suffer.
Speaking to Labour MPs at Westminster on Monday, Reeves said: “I understand the decision that this government has made on winter fuel is a difficult decision. I’m not immune to the arguments that many in this room have made. We considered those when the decision was made.
“Why are we having to make these savings? It’s not because we plan to, not because we wanted to, because there’s a £22bn black hole in the public finances because of the mess created by the previous government.”
The chancellor warned there would be more tough decisions to come, with Labour MPs expecting tax rises and spending cuts in her budget next month, against an already tight fiscal backdrop.
“I don’t say that because I relish it. I don’t, but it is a reflection of the inheritance that we face,” she said. “So, when MPs are looking at where to apportion blame, when pensioners are looking where to apportion blame, I tell you where the blame lies. It lies with the Conservatives and the reckless decisions that they made.”
While Starmer has faced criticism for his doom-laden rhetoric about the state of the country, Reeves did offer MPs a glimmer of hope.
“We have a once in a lifetime opportunity to reset politics in our country, and the prize on offer for all of us is huge,” she said.
“If we show that economic stability is the hallmark of Labour governments, there is no limit to what we can achieve, because with that stability comes investment. With investment comes growth. With growth comes prosperity.”
Rebels were muted in the meeting with the chancellor: just four MPs raised concerns about the threshold of the means testing. One MP said he did not expect many – if any – Labour MPs to vote against the measure. “Rachel has argued that to do that is to reject the whole notion of means testing and I think that’s not the point anyone wants to make. Everyone in that meeting agrees it’s not right that millionaires get this payment.”
One Labour politician in the room said: “A smattering of MPs said they would like the means testing to be done in a different way.” They said that of the 26 MPs who asked questions, about four had raised concerns about the government’s decision. “If people were wobbly Rachel’s performance will have moved them towards the government,” the MP said.
A Labour source said the loudest claps came when Reeves talked about the importance of uniting behind the government’s agenda.
One MP said the meeting had “lots of new MPs lecturing again about being elected on tough choices.”
Labour MPs say they expect mass abstentions in Tuesday’s vote but that whips have made it tacitly clear that any rebels would be at risk of having the whip suspended.
“That’s the consequence of the two-child benefit vote where they took out seven colleagues,” one MP who is planning to abstain said, referring to seven MPs who were suspended for voting for an SNP amendment. “The whips don’t even have to say it directly – it’s very obvious what the consequence will be.”
Several Labour MPs who have signed a motion criticising the changes told the Guardian they would not rebel, though many are planning to abstain. “The newbies will be under enormous pressure,” one MP said.
Among those planning to abstain on the vote is Rachael Maskell, one of the leading public critics of the plan. “It doesn’t really feel like there’s been an organised rebellion – I think most of them will just abstain,” a source on the Labour left familiar with the discussions said. “The feeling from some is that they don’t want to rebel too early into the parliament.”
Some MPs said they were holding out hope of a concession from the Treasury, such as a pledge to look at introducing an extended social tariff for energy bills. The vote on Tuesday afternoon will be a three-line whip though some MPs said they planned to stay away in their constituencies and be paired with Conservative MPs.
“I think that will broadly be acceptable to the whips – though there will need to be enough Tories absent in order for the pairs to work and there may not be enough,” one Labour source said.
The work and pensions secretary, Liz Kendall, has also been making personal overtures to MPs and stressing the mitigations the government is putting in place, including extending the Household Support Fund and pushing for an uptake in pension credit.
A leading anti-poverty charity warned on Monday that an extra 100,000 pensioners could be pushed into poverty by the measure. The Joseph Rowntree Foundation said that even with pushing take up of pension credit to everyone eligible, only about 36% of pensioners in poverty would receive the winter fuel payment.
Downing Street said the number of people signing up for pension credit had doubled since the government announced it was means-testing fuel payments. In the five weeks following Reeves’s announcement on 29 July, 38,500 pensioners signed up for the benefit, compared with 17,900 in the five weeks before it, according to figures issued by No 10.
Criticism of Labour’s decision to scrap the annual payment for most pensioners spilled into the open at the TUC, with Sharon Graham, the Unite general secretary, saying that Starmer should be “big enough and brave enough” to perform a U-turn on the plan.
“We need to make sure that [Starmer] is making the right choices and leadership is about choices,” she said. “People do not understand how a Labour government has decided to pick the pocket of pensioners and, at the same time, leave the richest in our society totally untouched. That is wrong and he needs to change course.”
Fran Heathcote, general secretary of public sector union the PCS, said her members in the Department for Work and Pensions heard “quite heartbreaking stories,” about the plight of cash-strapped pensioners.
The PCS has tabled an amendment to a TUC motion due to be debated on Tuesday, calling for unions to oppose the cuts to the winter fuel allowance.
