Sir Keir Starmer could reverse the controversial cut to Winter Fuel Payments as early as next month, according to new reports.
Talks inside No10 have ramped up this week after focus groups suggested voters wouldn't punish the Government for a U-turn, especially if it helps ease pressure on struggling pensioners.
Pressed about the reports on the margins of a major European summit in Tirana, Albania, the PM refused to deny that a policy change could be in the offing.
The Prime Minister said: "Look, we took difficult decisions, but the right decisions, at the budget, including the decision that we took on winter fuel. I mean, they were taken specifically with the purpose of stabilising the economy.
"And I think we're seeing the evidence of that in the interest rate cuts and the growth figures. So, they were difficult decisions but they were right decisions."
A Downing Street spokesman tried to downplay the PM's comments, saying: "There are always discussions about policies, but the policy stands."
Any change could come in the summer to ensure that it has been made before Winter Fuel Payments are scheduled to be sent out this Autumn.
Starmer braces for Winter Fuel Payments rebellion
PALabour's decision to means-test the benefit has been branded "kryptonite" by some of the party’s own MPs, who say it hurt them on the doorstep during local election campaigning.
There have also been claims that some voters believe the cut was made to help fund support for asylum seekers, a perception reportedly fuelling public anger.
Downing Street is now said to be weighing up whether to raise the income threshold from the current £11,500 to allow more pensioners to qualify.
While a full reversal of the policy is on the table, it is thought to be unlikely at this stage, The i understands.
The party faces a dilemma on whether to stick to the cut and risk further electoral damage, or climb down and admit the policy was a mistake.
The Government is reportedly preparing to reverse its decision to restrict Winter Fuel Payments, with an announcement potentially coming as soon as next month.
Last year, ministers limited the allowance to pensioners on Pension Credit or other income-related benefits, a move aimed at saving £1.4billion.
The cut, which was not included in Labour’s election manifesto, stripped around nine million pensioners of the annual payment, worth between £100 and £300. The policy was introduced by Chancellor Rachel Reeves just three weeks after taking office.
Labour claimed it was necessary to fill a £22billion shortfall caused by what it described as "undisclosed" overspending by the previous Conservative Government.
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Pensioners are distressed about recent changes to the Winter Fuel Payment allowance GETTY No final decision has been made on when a reversal might take effect, but some sources say Reeves could make an announcement as early as the June 11 spending review.
Others believe any changes would have to wait until the next major fiscal event in the autumn.
Downing Street is acutely aware of the public backlash to the Winter Fuel Payment cut, which dominated conversations on the doorstep during the recent local elections. Labour ended up losing two-thirds of the council seats it was defending.
The policy is also believed to have played a role in Labour’s defeat to Reform UK in the Runcorn and Helsby by-election earlier this month.
Senior Labour figures, including Welsh First Minister Eluned Morgan, have joined calls to rethink the controversial move.
No final decision has been made on when a reversal might take effect
GETTYThe Labour Red Wall Group, representing long-standing Labour heartlands, has written to Starmer urging him to respond to voters' concerns - insisting it is not "weak" to listen and act.
Labour MPs have been critical of the winter fuel policy since its introduction, with concerns growing across the party. Former Transport Secretary Louise Haigh admitted that Labour’s "unpopular decisions are overshadowing the good ones".
Up until now, senior figures in Government had resisted a U-turn, citing fiscal constraints and fears it would make Sir Keir Starmer appear indecisive.
Internal focus groups now suggest the policy is becoming a major distraction, preventing the Government from getting traction on its broader agenda.
