Starmer's winter fuel U-turn seeks to calm Labour nerves

The details will follow in the Budget this autumn. But make no mistake, this is a U-turn.

The decision to means test the winter fuel allowance was one of the first announcements made by Sir Keir Starmer and Rachel Reeves almost a year ago.

It was intended to demonstrate both the dire state of the government's economic inheritance and the new regime's willingness to take tough decisions in response.

It didn't quite turn out that way.

Early grumblings from MPs generally on the Labour left rapidly spread into more unexpected parts of the party.

Even those MPs who made a decent fist of defending the policy right to the end admitted that it was the most frequently raised issue by members of the public when they were out campaigning.

It was widely blamed for a bad set of local election results and the dismal defeat to Reform at the Runcorn and Helsby by-election on the same day.

There is an interesting debate even among those MPs who were clamouring for a U-turn of this sort about whether the policy was always destined to be a failure.

Some believe that it was intrinsically inept to target a benefit paid to pensioners. Others believe the threshold should have been set higher so that fewer pensioners lost out. Another group say that if the Budget - with a big tax rise and funding boost for public services - had come at the same time, it would have made the winter fuel policy less isolated and as a result less controversial.

And yet another group believe that the government's failure lay in neglecting to make a positive case for the policy.

Instead of sorrowfully saying they had been forced into the means-testing by Conservative misrule, this argument goes, Sir Keir and Ms Reeves should have argued that there were many pensioners who simply did not need the money.

All that is of academic interest now. A consensus had formed across the Labour Party that the policy was a colossal political misstep and from that point on the logic facing this prime minister - who is utterly unsentimental about moving on from old policy positions - was remorseless.

Why now though?

One reason may be that rumours had reached overdrive that an announcement was in the offing. Given that ministers' conspicuous non-denials were becoming non-stop, there may have been a calculation that it made more sense just to acknowledge the inevitable now.

But it is also worth considering the broader context. Winter fuel was by no means the only contentious element of this government's economic policy.

There is a rebellion brewing on the government's welfare cuts. Those are likely to face a vote in the Commons next month although estimates of how big the rebellion might be vary wildly.

The government is in no mood to concede on that issue - as demonstrated by Work and Pensions Secretary Liz Kendall's speech this morning. Apart from anything else, they cannot afford to. The welfare reforms raise far more money than the means-testing of winter fuel was meant to.

But Sir Keir and his party whips will now be able to reassure anxious Labour MPs that they do listen to their complaints, even if they cannot address them in every area.

Fundamentally this is embarrassing for Reeves. She made a big, bold and early call and has reversed it within 10 months.

Her economic and political judgment is increasingly widely questioned within her own party - as demonstrated, just as one example, by the memo from Angela Rayner's department splashed across the front page of the Telegraph this morning.

The most important verdict on this reversal, though, will come from the public.

Is it a sign of strength from a pragmatic government willing to listen to criticism and act fast in response? Or a sign of weakness from an ideologically unmoored government which does not know what it believes?

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