Labour deputy leader Tom Watson is stepping up pressure on Theresa May to maintain free TV licences for the over-75s.
In a letter to the prime minister, he warned that scrapping the benefit would represent a “huge financial blow” to millions of pensioners and breach a Conservative general election manifesto pledge.
His intervention comes as a BBC consultation on whether to carry on with the scheme after government funding ends in 2020 is due to close on Tuesday.
The government has already confirmed the cost of a licence is to rise from £150.50 a year to £154.50 from April.
Last month, the charity Age UK warned that scrapping the free TV licence for over-75s could push 50,000 older people into relative poverty.
In his letter, Watson, who is also shadow culture secretary, said “outsourcing” responsibility to the corporation would deliver a £745m “windfall” to the government in 2021-22.
He said that it would come on top of the £220m the Treasury is already set to save from changes to pension credit.
“This money, nearly a billion pounds, is coming directly out of the pockets of pensioners.
“A billion pound blow to pensioners is a billion pound windfall for the Treasury’s coffers,” he said.
“Rather than profiting from pensioners I ask that your government protects pensioners.
“Instead of using this money to bolster the government’s balance sheet you should use the money to honour your manifesto commitment and save free TV licences for over-75s.”
