Dear Listener

Of course Budget week is My Sort Of Week. I love the Speech. I love the Opposition Response. This year I loved tweeting instant reaction on my twitter @paullewismoney. I love shouting at the quick summaries on TV if they’re not quite right or miss the point. And I love it when the thick bundle of papers weighing several pounds arrives on my desk and I can plough through them finding the fiddly bits others may have missed. I know, I’m sad. But that is how it has been since I queued up for the Budget bundle at Somerset House – often in the rain it seemed – listening to the summaries on Radio 4 from journalists dashing in and out of the Commons press gallery with their notes in the days before Parliament was broadcast (radio began in 1978; TV in 1989). Yes, I am that old.

I mention all this because I do keep my old Budget papers – in the past in a filing cabinet and now as pdfs on my computer. Which is just as well. Because when I came to look for the decision on cutting winter fuel payment this year I couldn’t find it in the 2011 Budget papers, hefty though they were. Normally every item of spending or saving has a line in a summary table saying what it will cost or save. So, for example, the changes to duty on petrol and diesel will cost around £2bn a year and raising the personal tax allowance about £1bn in 2012/13. But there is no mention in the text or the tables of the decision to reduce the Winter Fuel Payment from £250 aged 60-79 and £400 aged 80+ to £200 and £300 respectively.

So I went back to my old Budget papers to find out more. It turns out that the Winter Fuel Payment has actually been £200 and £300 all along. But for each of the past three years the previous government added on an ‘additional age-related payment to pensioner households’ of £100 for those over 80 and £50 for those aged 60-79. So by simply not mentioning it in the Budget the additional amount lapsed and the Winter Fuel Payment reverted to £200/£300. And it is only in the old papers that I found the saving – or rather the cost of making the payment for the past three years. Which was £600 million a year. So that is the saving this year. Except it’s not a saving. Just an absence of spending. And not mentioned.

Incidentally this tangled history allows the Government to say that it has fulfilled its promise in the Coalition Agreement of May 2010 “We will protect key benefits for older people such as the winter fuel allowance” (they meant ‘payment’).

***IN MONEY BOX THIS WEEK***

The Budget of course will loom large (a phrase from 1926) in the programme. Tax allowances, merging tax and NI, the £140 pension promise, fuel duty, stamp duty, small business help, National Savings and more! I told you it was interesting.

A listener is worried that she has lost money after paying for tickets for the 2012 London Olympics on an unofficial website. We talk to the police about what people should do to protect themselves. And investigate how widespread unofficial sites are.

You buy a computer for £1000 but need to borrow the money. You are offered two choices (a) borrow £1000 and pay back £100 a month for 12 months; (b) borrow £1000 and pay back £1200 a year later. Which is the better deal (a) or (b) or are they (c) the same? Yes, it must be a guest appearance of More or Less presenter and Financial Times Undercover Economist Tim Harford (@timharford to his tweeps). The wonderful More or Less returns next Friday at 1330. Tweet an answer www.twitter.com/paullewismoney. 

There may be more (phones are humming as I write). There won’t be less. Live on Radio 4 on Saturday just after noon. The repeat is on Sunday at 9pm and you can of course listen any time via the podcast page www.bbc.co.uk/podcasts/series/moneybox. Check out our website www.bbc.co.uk/moneybox to follow links, download transcripts, send us stories or ideas you want us to look into and Have Your Say on unofficial ticket websites – have you lost money?

And if you want to see the team in action we will be live in Plymouth at the Drake Shopping centre this Wednesday 30th. Money Box Live will broadcast – live – from the centre at 3pm. It’s all part of the BBC’s Money Matters Roadshow. You can be part of the Money Box Live audience, ask a question live on air (email it now through our website www.bbc.co.uk/moneybox) or get confidential financial advice from a team of professionals who are there all day.

This newsletter is available at bbc.co.uk/moneybox/newsletter around the time it hits your inbox (tell your friends who don’t subscribe) and you can join nearly 5000 others who enjoy my random but timely thoughts on money 24 hours a day at www.twitter.com/paullewismoney.

Best wishes,

Paul

PS don’t forget the programme trail on Breakfast on BBC 1 around 0840. And I am back on Breakfast either on Wednesday morning from Plymouth or as usual on the sofa on Thursday.

e-mail Paul Lewis