Sharing the burden will enable tax cuts in the future

The elderly have been sheltered from cuts, so far at least. New research from the IEA suggests that the government could save an additional £16bn a year simply by cutting the various non-means-tested benefits older people receive and by making some minor changes to the pensions system.

Such a cull would include: the abolition of free bus travel (which would save £1.3bn per year), free TV licences (£0.7bn) and the winter fuel allowance (£2.1bn). In addition to those cuts, the state pension age should be raised to 66, which would save an extra £5bn. Abandoning the “triple lock” policy for pension increases from 2011 would save another £5.6bn, and increasing the minimum income guarantee for pensioners in line with prices rather than wages would save a further £0.8bn.

Electorally, the government may fear that it has much to lose by implementing these policies. But with public spending due to return only to the levels of 2008, the coalition needs to make further savings if it is ever to reduce taxes, which is surely a vote winner?