“Any income over standard OAP pension of £11,500pa is taxable @ 20%.”
I’m not quite sure what you mean, tambo. The “standard” OAP pension is not £11,500. At present the basic State Pension is £6,360. The State pension certainly does form part of the recipient’s taxable income, meaning that those with an occupational pension of more than £11,500 will effectively lose 20% (or possibly more) of their State Pension payment. They are the very people, of course, who will be “means tested” out of the Winter Fuel Payment.
I have a different view of the Winter Fuel Allowance to most. Many occupational pensions include allowances and extra payments on top of the monthly sum. I take a similar view with the State Pension and I consider that it is made up of the basic payment, the winter fuel allowance, the Christmas bonus and free travel. Many people have paid in quite considerable sums for their retirement package. Already many of those who have paid in the least receive more than those who have contributed the most (because they receive “Pension Credit”). Now we learn that those who have almost certainly paid in the most will have part of their package arbitrarily withdrawn. In a proper pension scheme this would appear perverse as payments are usually directly proportional to contributions, not inversely so. If any examination of eligibility must take place it should begin by examining contributions made.
“Won't it be difficult to means test ??”
No it won’t. HMRC knows almost to the penny how much every person in the country (other than those in the “black” economy) receives in salaries, pensions, benefits, interest and dividends.