Balls's winter fuel gambit: Strategically flawed, tactically risky - and, in policy terms, absolutely right

By Paul Goodman
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Ed Balls was trained by Gordon Brown in the rhetoric of "investment versus cuts" - in other words, issuing spending pledges to be paid for by borrowed money, which the evil Tories would then be challenged to meet.  David Cameron's election campaign outburst about "smears" and "lies" - in response to Labour leaflets that the Conservatives would scrap such universal payments as Brown's Winter Fuel Allowance - was evidence of how much pressure the tactic was capable of generating.  The gambit was also a useful reminder to the lobby and interest groups which support universalism of Labour's support for the principle.

The Shadow Chancellor's announcement this morning that Labour would not pay the allowance to pensioners aged over 75 if their income is higher than £32,000 a year is therefore strategically puzzling - since it lets Cameron off the hook over means-testing the payment (and going on to extend the principle to free bus passes and TV licences).  All three main parties now look to enter the next election with broadly the same policy on the allowance.  Balls will also be pressed now on whether Labour would definitely implement the plan in 2015 - and, if so, why he won't promise to implement other Labour plans then, such as its proposed VAT cut (and extend the means-testing principle, too).

Since Balls isn't stupid (really), the only conclusion to be drawn is that he and Miliband have agreed to put tactics above strategy, at least in this case.  Miliband is badly exposed to the charge that Labour lack credibility on the defict and the economy. (Grant Shapps made the most of Labour's weakness on the site this morning, just as Michael Gove did in the Daily Telegraph last week.)  His poll ratings are feeble and Labour's lead is weak: it is not at all unlikely that the Conservatives will emerge in 2015 as the biggest single party.  Best, then, to have an internal row over universality by projecting an external message of toughness over responsibility.

The new policy also allows Labour to threaten Cameron with another Commons vote in which the Liberal Democrats can be peeled off from their Coalition partner: one is already threatened on the mansion tax.  The effects of the Shadow Chancellor's manoevre will also be felt within the Conservative Party itself, since some Tory MPs are all for restricting universal payments.  Peter Hoskin has repeatedly called for the means-testing of the Winter Fuel Allowance and other pensioner benefits on this site (as I have too, from time to time).  All in all, then, the move is strategically flawed, tactically risky - and undoubtedly, in policy terms, absolutely right.