Robert Peston, ITV’s political editor, has posted a damning verdict on the government’s handling of the winter fuel payments issue on social media. Here is an extract. So the u-turn only goes to prove the utter pointlessness of the original abolition last summer of the universal entitlement to it. This initial £1.6bn saving - revised down to £1.3bn by the OBR - was supposedly essential to placate lenders to the British government, bond investors, who Reeves believed needed reassurance that she would fill the hole in the public finances she said she inherited from the previous Tory government. But it was always a drop in the ocean of the government’s borrowing needs - and remains so, even after the £40bn of tax rises that she imposed in last autumn’s budget. Or to put it another way, most economic forecasters believe today she is likely to need tax rises this coming autumn, just as they did a year ago. Yet a year ago, Reeves argued any unfunded spending commitment would be fiscal suicide, whereas today such an unfunded commitment is tickety boo. In other words, she and the Treasury have achieved a rare - though not unique - distinction of alienating vast numbers of British voters for next-to-zero fiscal or economic benefit. The SNP says the government should follow the winter fuel payments U-turn by reversing the two-child benefit cap. In a response to the Treasury announcement, Stephen Flynn, the SNP leader at Westminster, said: The chancellor must now abandon her devastating cuts to disabled people – and scrap the two-child benefit cap. This screeching U-turn was inevitable and lessons must be learnt from the damaging mess the Labour government caused by robbing pensioners of their winter fuel payments. It must be swiftly followed by an end to all Labour party austerity cuts – scrapping the planned cuts to disability benefits and abolishing punitive welfare policies, including the Labour government’s two-child benefit cap and bedroom tax. At 3.30pm there will be an urgent question in the Commons about “the United States government’s national security concerns regarding the proposed Chinese embassy development at Royal Mint Court”. The former Tory leader Iain Duncan Smith is asking the question, and a housing minister will reply. Later, at about 4.15pm, Torsten Bell, the pensions minister, will make a statement about the winter fuel payments announccement. Nigel Farage has claimed credit for the government’s winter fuel payments U-turn. But the government has not resinsted the payments for everyone, which is what Reform UK was asking for. At the Downing Street lobby briefing the PM’s press secretary said there was a big difference between the two policies, because Reform UK’s was unfunded. She said: We set out the policy detail now to ensure the change can be delivered ahead of winter and give pensioners certainty. Everything this government does is fully funded. Reform has floated tens of billions of pounds of unfunded tax cuts, they’ve suggested slashing government spending to 35% of GDP, which is equivalent to scrapping the entire NHS, defence, policing and criminal justice budgets combined. Their fantasy economics would see the exact same consequence as working people suffered under Liz Truss and the Conservatives, and is why this government has totally rejected that approach and put fiscal responsibility at the forefront of every decision that we take. Rachel Reeves, the chancellor, has rejected calls (see 12.18pm) to apologise for removing winter fuel payments from most pensioners last winter. Asked in an interview with ITV News if she would apologise for causing “unnecessary anxiety and hardship”, Reeves replied: The irresponsible thing to have done last year was to allow the public finances to carry on on an unsustainable footing. That would have resulted in interest rates going up, costing families and pensioners more in mortgages and rents. I’m always going to put stability in our economy first. Here is the clip. At one point the Treasury was concerned that, using the tax system to claw back winter fuel payments from wealthy pensioners could lead to the government trying to recoup the money from the estates of pensioners who died over the winter. But today Downing Street has said this will not happen. At the morning lobby briefing the PM’s spokesperson said: HMRC will not ask for repayment from a deceased PAYE (pay as you earn) customer if the only money owed was from a winter fuel payment. The Treasury says restoring the winter fuel payments for most pensioners will cost around £1.25bn in England and Wales. It says: The costs will be accounted for at the budget and incorporated into the next OBR forecast. The chancellor will take decisions on funding in the round at that forecast to ensure the government’s non-negotiable fiscal rules are met. This will not lead to permanent additional borrowing. Paul Johnson, director of the Institute for Fiscal Studies, says ‘no extra borrowing’ means ‘higher taxes, or welfare cuts’. The corollary of “this will not lead to permanent additional borrowing” is that it will lead to permanent additional taxes (or just possibly permanent cuts to other bits of welfare). As the Treasury explains in its news release about the winter fuel payments proposal, although the government is basically restoring winter fuel payments (and clawing them back from the wealthy), it is changing the way payments are being delivered. It says: Where the household is not getting an income related benefit, such as pension credit, a shared payment will be made – e.g. a couple, each under 80, not on pension credit will receive a payment of £100 each. This reflects the fact that benefits are often paid on a household basis, but the tax system, which is being used to recoup the payments to wealthy people, looks at individual income. In a post on social media, Paul Johnson, director of the Institute for Fiscal Studies thinktank, says this new arrangements is a bit “messy”. He explains. WFP will now be paid at £100 to each member of a couple. So rich pensioner couples, where one has say £100k and the other £30k, will still get £100. If both members of couple have £36k then they get nothing. Messy. In his speech in Port Talbot Nigel Farage, the Reform UK leader, accused the government of timing its winter fuel payments to overshadow his speech. And, like the Tories and the Liberal Democrats (see 12.18pm), he also claimed that he had forced the U-turn. I kept on saying all but the very wealthiest pensioners should get the winter fuel allowance, particularly as we have the most expensive energy costs in the world directly as a result, of course, of the fanatical embrace by both Conservative and Labour governments of net zero. To illustrate his point, Farage waved a copy of the Daily Express which splashed on Farage’s views on this. Farage said there was “no doubt” in his mind that his campaigning “made the political weather on this one”. The Conservatives and the Liberal Democrats are both trying to take credit for the winter fuel payments U-turn by the government. This is from Kemi Badenoch, the Tory leader. Keir Starmer has scrambled to clear up a mess of his own making. I repeatedly challenged him to reverse his callous decision to withdraw winter fuel payments, and every time Starmer arrogantly dismissed my criticisms. This humiliating U-turn will come as scant comfort to the pensioners forced to choose between heating and eating last winter. The prime minister should now apologise for his terrible judgement. And this is from Ed Davey, the Lib Dem leader. Finally the chancellor has listened to the Liberal Democrats and the tireless campaigners in realising how disastrous this policy was, but the misery it has caused cannot be overstated. Countless pensioners were forced to choose between heating and eating all whilst the government buried its head in the sand for months on end, ignoring those who were really suffering. We will now study the detail of this proposal closely to make sure those who need support actually get that support. The pain they went through this winter cannot be for nothing. It is unusual for the government to a make a major announcement by press release at noon. It is much more common for news like the winter fuel payments decision to come in a story embargoed overnight, or in a statement to MPs, or in a speech by a minister. But, for No 10, press releasing this now means that the live news broadcasters might be be paying a bit less attention to what is happening in Port Talbot, where Nigel Farage, the Reform UK leader, was due to give a speech at starting – at noon too. There is a live feed here, but Farage does not seem to have started yet. The Treasury has announced that the “vast majority” of pensioners will get their winter fuel payments back this winter. It has confirmed this in a news release issued at noon. To be more accurate, all pensioners in England and Wales are getting the benefit back – but pensioners with an income of more than £35,000 will have the money clawed back through their tax return (unless they chose to opt out of gettting the payment in the first place. The Scottish government and Northern Ireland executive will receive money from Whitehall to fund their own equivalent policies. The Treasury says this means nine million pensioners in England and Wales will get the payments again. But this figure includes the 1.3 million people who received it this winter, because they were poor enough to qualify, and so it would be more accurate to say that about 7.5 million pensioners will gain. In a news release it says: Nine million pensioners to receive winter fuel payments this winter as all pensioners in England and Wales with an income of, or below, £35,000 a year will benefit from a winter fuel payment. This extends eligibility to the vast majority of pensioners, with around 9 million, or over three quarters, benefitting. This threshold is well above the income level of pensioners in poverty and is broadly in line with average earnings, balancing support for lower income pensioners with fairness to the taxpayer This change will cost around £1.25 billion in England and Wales and see means-testing of the winter fuel payment save around £450 million, subject to certification by the Office for Budget Responsibility compared to the system of universal winter fuel payments. The costs will be accounted for at the budget and incorporated into the next OBR forecast. The chancellor will take decisions on funding in the round at that forecast to ensure the government’s non-negotiable fiscal rules are met. This will not lead to permanent additional borrowing. No pensioner will need to take any action as they will automatically receive the payment this winter, and for those with incomes above the threshold it will be automatically recovered via HMRC. The payment of £200 per household, or £300 per household where there is someone over 80, will be made automatically this winter. Over 12 million pensioners across the United Kingdom will also benefit from the triple lock, with their state pension set to increase by up to £1,900 this parliament. Here is Pippa Crerar’s story about the news. More than £1bn has now been paid out to post office operators who were victims of the Post Office Horizon IT scandal, the government has announced. In a news release the Department for Business and Trade said: More than £1bn has been paid out to over 7,300 postmasters affected by the Horizon IT scandal – one of the biggest miscarriages of justice of our time. This figure is a total across the Horizon-related redress schemes, with data published by the government today. This milestone marks the government’s ongoing commitment to deliver redress and justice to postmasters as swiftly as possible. Details of the payments are here. This chart shows how much has been paid through the various compensation schemes: the Horizon Shortfall Scheme (HSS), the Overturned Convictions (OC) scheme, the Group Litigation Order (GLO) scheme and the Horizon Convictions Redress Scheme (HCRS). Zia Yusuf, the former Reform UK chair, has defended one of the party’s MPs against allegations that a mug she was photographed holding during her byelection campaign was Islamphobic. As LBC revealed last week, Sarah Pochin posed for a picture when she was campaigning holding a mug with a picture of Keir Starmer wearing a hijab with the caption “Two-Teir Keir”. Campaigners have described this as Islamphobic. Last week Pochin asked Starmer at PMQs if he would ban the burqa. Yusuf, who is Muslim, posed a message on X describing that as a “dumb” question, because banning the burqa is not party policy, and a few hours later he resigned, saying he had concluded that he now longer believed “working to get a Reform government elected is a good use of my time”. On Saturday Yusuf announced that he had made a mistake, that he had reconciled with Nigel Farage and that he was returning to a party role – although not as chair. In his first broadcast interview this morning, Nick Robinson, the presenter, asked Yusuf about claims that his resignation was partly motivated by his concern about the dominance of anti-Islam thinking in the party. Yusuf brushed aside these suggestions. He said that he resigned because he was exhausted and that, although he described Pochin’s question as “dumb”, that was a mistake and that Pochin was a “brilliant” MP. The word just referred to the question, not her, he stressed. Asked if he was comfortable about the picture of her holding the anti-Stamer mug, he replied: I think Sarah is an incredible MP question … Look, what I will say is, if we’re going to talk about Islam in the UK, to the degree that there is resentment building up about some of these issues, it is in no small part because it is my view that certain communities in this country are subject to two-tier policing. Asked again if he was comfortable with Pochin using a picture of a Muslim head covering to attack Starmer, Yusuf said he was comfortable with this because he knows Pochin well. She was laughing in the picture, he said. Asked if it suggested “a pretty unpleasant” attitude to Muslims, Yusuf said he did not accept that. He said that Pochin had been a magistrate for two decades, that he know who she was and “what’s in her heart”, and that some of the things said about the picture were “complete mischaracterisations”. Yusuf also said that, although he was “uneasy” about the idea of banning the burqa, he thought that, if he were an MP he “probably would be in favour” of the idea. Sadiq Khan, the Labour mayor of London, is unhappy about what is on offer to the capital in the spending review, my colleague Jessica Elgot reports. She has posted these on Bluesky. Some anger over at City Hall over the spending review- London expected to miss out on some key asks DLR extension to Thamesmead, Bakerloo Line extension Mayoral powers to introduce a touristlev Extra funding for Met Police Source says none of these are in SR and mayor thinks this is unacceptable There is an argument to be made of course that London has had billions of extra investment over past decades but the policing settlement will be a big issue. And very little proper argument against a tourist levy (though could be revisited at Budget) Source “it will simply not be possible to achieve national growth ambitions without the right investment and growth in our capital. We must not return to the damaging, anti-London approach of the last government.” The police are not the only group engaged in last-minute lobbying ahead of the spending review. Ed Davey, the Lib Dem leader, is today urging the government to rule out cuts to social care. He says he wants the government to fund a Lib Dem proposals for all families with caring needs to be assigned a named carer and social worker. In a statement he says: Any further cuts to social care at the spending review would be devastating for the countless people in desperate need of care. Years of Conservative neglect broke the system, with massive consequences for our health service, but now the Labour government is moving at a snail’s pace in addressing this crisis. Without fixing social care, we cannot fix the NHS so it beggars belief that ministers seem willing to let the rot continue. We simply cannot wait more than a decade for reforms to be put in place, whilst the number of people suffering grows. The government needs to get serious and that starts by completing their [social care] review by the end of the year with the reforms to follow as quickly as possible alongside introducing a named carer for each family who needs support. At London Tech Week Keir Starmer also said he wanted parents to know the government would use technology to create a “better future” for their children. He said: By the end of this parliament we should be able to look every parent in the eye in every region in Britain and say ‘look what technology can deliver for you’. We can put money in your pocket, we can create wealth in your community, we can create good jobs, vastly improve our public services, and build a better future for your children. That, to me, is the opportunity we must seize. That’s what my plan for change will deliver and, today, I think we’re taking another big step towards it. Keir Starmer has been speaking at a London Tech Week event this morning, and he has announced that by next spring the government will roll out a new AI tool for councils allowing them to digitise planning documents within minutes. The government says this tool, developed using Google DeepMind’s Gemini model, will free up thousands of hours of officers’ time. In a news release, Downing Street explains: For the first time, this cutting-edge technology will help councils convert decades-old, handwritten planning documents and maps into data in minutes – and will power new types of planning software to slash the 250,000 estimated hours spent by planning officers each year manually checking these documents. This will dramatically reduce delays that have long plagued the system. Around 350,000 planning applications are submitted a year in England, yet the system remains heavily reliant on paper documents – some hundreds of pages long. Once submitted, each of these documents needs to be manually validated and approved by a planning officer. In test trials across Hillingdon, Nuneaton & Bedworth, and Exeter councils, Extract digitised planning records, including maps, in just three minutes each – compared to the 1–2 hours it typically takes manually. This means Extract could process around 100 planning records a day – significantly speeding up the process. This represents a step-change in productivity, freeing up thousands of hours for planning officers to focus on decision-making to speed up housebuilding. It will also accelerate the delivery of much-needed housing, improve reliability in the planning process and reduce costs and save time for councils and developers. Extract is expected to be made available to all councils by spring 2026. The government’s ambition is to fully digitise the planning system - making it faster, more transparent, and easier to navigate for working people, councils, businesses and developers. For Starmer, this is familiar territory. As director of public prosecutions, one of his achivements he talks about most was digitalising court records. Starmer also confirmed a £187m programme to extend AI teaching in schools. Good morning. In theory spending review negotiations can go up to the wire, with the final talks to resolve sticking points taking place late at night, only hours before the decisions, and documents, are presented to MPs. In practice, it does not really happen like that now, last-minute haggling is no longer routine, and, with two days to go before the spending review that will settle government spending until 2019, only one cabinet minister has not yet settled. Here are the key developments this morning on the issue that will dominate the week. Angela Rayner, the deputy PM and housing secretary, settled with the Treasury late last night. The news was broken by Arj Singh from the i, who reports: The i Paper understands that Rayner and Reeves agreed a deal just after 7.30pm after marathon talks on Sunday. But Home Office and Treasury sources were tight lipped on Sunday, in an indication that negotiations over police funding are also going to the wire. That means Yvette Cooper, the home secretary, is the only minister yet to agree a spending settlement with the chancellor, Rachel Reeves. In the Times Chris Smyth says police budgets are expected to rise by more than inflation, but other parts of the Home Office budget may face cuts. He reports: It is understood that Reeves has insisted that policing budgets will rise in each year of the spending review, which sets funding up to 2028-29. However, it remains unclear if the boost will match the more than £1 billion extra officers say is needed to cover existing shortfalls. Cooper is also expected to have to find deeper cuts elsewhere to boost police budgets. The Border Force has warned of longer queues at airports as it faces cuts to its £1.2 billion budget, saying there would be a “threat to national security” if it lost frontline staff. Two police unions have launched a last-minute bid for extra money. In an article in the Daily Telegraph, Nick Smart, president of the Police Superintendents’s Association, and Tiff Lynch, acting chairman of the Police Federation of England and Wales, say: Police are being asked to do more with less – again – as pressure mounts on already overstretched budgets. Why? Policing faces a £1.2 billion shortfall. This is before it is asked to deliver the ambitious pledges of the new government. Police forces across the country are being forced to shed officers and staff to deliver savings. These are not administrative cuts. They go to the core of policing’s ability to deliver a quality service: fewer officers on the beat, longer wait times for victims, and less available officers when a crisis hits. As a practical lobbying exercise, this is fairly pointless, because it comes too late, but the two unions are making their case to the public. Chris Bryant, the culture minister, has said that the spending review will mark “an end to austerity”. He told Times Radio: We know from running the government that spending money of itself isn’t an achievement. Spending money and getting results is an achievement and that’s why we are saying now with this spending review on Wednesday it’s an end to austerity … That period of austerity where I think previous governments simply cut all public service budgets just because they believed that was what you had to do is over. But he also said some budgets would be “stretched”. He said health and defence spending would rise, but added: There are going to be other parts of the budget that are going to be much more stretched and be difficult. Ministers have been promising the end of austerity at least since Theresa May was in office. Labour defends using this phrase on the grounds that overall government spending is going up in real terms. But there is no agreed definition of “austerity” and, if spending is falling in certain areas, that may feel like austerity, and so using the term does not contribute a lot to public debate. What it does mean, though, is that governments saying they are ending austerity definitely don’t want to be associated with George Osborne. Here is our overnight story about the spending review. Here is the agenda for the day. Morning: Keir Starmer gives a speech at a London Tech Week event. 11.30am: Downing Street holds a lobby briefing. Noon: Nigel Farage, the Reform UK leader, gives a speech at Port Talbot in south Wales. 2.30pm: Angela Rayner, the deputy PM and housing secretary, takes questions in the Commons. Also, Starmer is meeting Mark Rutte, the Nato general secretary, in Downing Street today. If you want to contact me, please post a message below the line when comments are open (normally between 10am and 3pm at the moment), or message me on social media. I can’t read all the messages BTL, but if you put “Andrew” in a message aimed at me, I am more likely to see it because I search for posts containing that word. If you want to flag something up urgently, it is best to use social media. You can reach me on Bluesky at @andrewsparrowgdn.bsky.social. The Guardian has given up posting from its official accounts on X, but individual Guardian journalists are there, I still have my account, and if you message me there at @AndrewSparrow, I will see it and respond if necessary. 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Author: Andrew Sparrow