Keir Starmer last night opened the door to a dramatic U-turn on the winter fuel allowance.

The Prime Minister refused to deny reports that he is in talks to water down the cruel cut which has become a millstone round Labour's neck.

Ministers are discussing proposals that could see the annual payment, worth up to £300, restored to millions of pensioners who lost it last year in one of Labour's first acts in power.

The Prime Minister last night defended the decision to means-test the payment, saying the £1.4 billion savings had helped to 'stabilise the economy'.

But he refused three times to deny that talks are under way to soften the impact of the policy, which has been blamed by Labour MPs for the collapse of the party's poll rating.