UK PM Starmer sees off rebellion over cuts to winter fuel payments

By Andrew MacAskill and Elizabeth Piper

LONDON (Reuters) -British Prime Minister Keir Starmer avoided a major rebellion in his party on Tuesday over plans to cut 1.5 billion pounds ($1.96 billion) in winter fuel payments to the elderly after unhappy lawmakers abstained rather than voting against the government.

The vote was an important test of Starmer's authority just two months after winning a landslide election victory, and of his plans to press ahead with some government spending cuts, which he says are vital to improving Britain's public finances.

In the end, only one of 404 Labour lawmakers voted against the plan and 53 did not vote in the House of Commons. Some lawmakers worried that if they did not back the policy, they could face disciplinary action after Labour suspended seven lawmakers for voting against the government in July.

"We must fix the foundations of our economy," Liz Kendall, the work and pensions minister, told parliament. "When money is tight our priority must be to target resources on those who need it most."

Despite calls to rethink or mitigate the impact of the policy to scrap the payments to around 10 million pensioners who do not receive government welfare benefits, Starmer refused to back down saying controlling spending was necessary to create the conditions for investment and future economic growth.

Elected on July 4 on a promise to rebuild Britain, Starmer has raised the possibility of tax rises on the wealthy and further spending cuts in next month's budget to try to fix a raft of problems he blamed on 14 years of Conservative misrule.

In a speech to the Trades Union Congress earlier on Tuesday, Starmer was unapologetic, saying his priority was economic stability. He accused the last Conservative government of having left a 22 billion pound ($29 billion) financial black hole, forcing him to take difficult decisions. That charge is disputed by the Conservatives, now in opposition.

Starmer received a warm, although muted, response to his speech from union leaders, who have publicly criticised his plans to restrict the fuel payments.

Government ministers say that providing all pensioners' with fuel payments is wasteful because they were received by wealthy people who did not need the help.

But the policy will reduce payments worth up to 300 pounds ($390) a year to some pensioners on low incomes, who are not eligible for government benefits.

Mel Stride, the Conservative Party's work and pensions chief, asked Labour politicians during a debate in parliament to "look to your conscience" and vote to stop the cut that he said would lead to hardship for millions of elderly people.

Starmer has refused to say what action will be taken against the Labour lawmaker who voted against the government.

In July, Starmer took a hardline stance against party rebels who voted against the government for an amendment to scrap the two-child benefit cap, suspending the seven Labour members from the parliamentary party for six months.

($1 = 0.7660 pounds)

(Reporting by Andrew MacAskill and Elizabeth Piper; Editing by Gareth Jones and Alison Williams)