- The government and local authorities are planning a Pension Credit ‘Week of Action’ in September in an attempt to boost take-up of the benefit (Source: Pension Credit awareness drive as thousands of eligible pensioners yet to claim - GOV.UK (www.gov.uk))
- Move comes after chancellor Rachel Reeves announced the Winter Fuel Payment, worth up to £300, will be means-tested this year
- The decision means only those in receipt of certain benefits, including Pension Credit, will receive the Winter Fuel Payment
- Around 4-in-10 older people who are eligible for Pension Credit fail to claim the benefit each year, meaning hundreds of thousands are at risk of missing out (Source: Income-related benefits: estimates of take-up: financial year ending 2022 - GOV.UK (www.gov.uk))
- Pension Credit top-ups are worth thousands of pounds on average and also unlock additional help for low-income retirees
Tom Selby, director of public policy at AJ Bell, comments:
“Chancellor Rachel Reeves’ decision to means-test the Winter Fuel Payment means it is more important than ever those entitled to Pension Credit make a claim this year. Where previously the Winter Fuel Payment was paid to all pensioners, it will now only go to those in receipt of certain benefits, including Pension Credit.
“Worryingly, Pension Credit is chronically underclaimed, with around 4-in-10 of those who are entitled to the benefit failing to receive it, according to the latest available government data. Given there were around 1.4 million Pension Credit claimants in February, that means hundreds of thousands of low-income pensioners are at risk of missing out on their Winter Fuel Payment this year. In addition, Pension Credit itself is worth £3,900 a year on average to those who do claim, according to the government, and also unlocks a range of other valuable benefits.
“The last-ditch awareness push announced by the government today is welcome but it faces a stiff challenge in overturning what has been a persistent Pension Credit claims gap over the years. There are a number of reasons why Pension Credit goes underclaimed beyond lack of awareness, including the complexity of the process and the stigma that is often attached to claiming benefits.
“Pensioners have until 21 December to make a Pension Credit claim in order to receive the Winter Fuel Payment. This is the last date when people can make a backdated Pension Credit claim for the ‘qualifying week’, which is between 16 and 22 September 2024. Given many of the people entitled to Pension Credit will already be in a vulnerable position ahead of winter, it is absolutely crucial take-up is dramatically boosted so those entitled to desperately needed extra financial help receive it.
“The previous government made similar attempts to drive people to claim Pension Credit, with an awareness campaign last year. At the time Pension Credit also offered a pathway to accessing additional cost of living payments, yet it seems to have had minimal impact on uptake. Government will need to really drive home the message this time and may need to think about different ways to reach potential claimants.”
Pension credit explained
Pension Credit is a key benefit provided by the state which often tends to go unclaimed by lower income retirees.
In 2024/25, if you are over state pension age (66), single and your income is less than £218.15 a week then Pension Credit will top you up to that amount. For a couple, the combined income figure is £332.95.
In relation to pension credit, your income includes your state pension, other pensions, employment or self-employment earnings and most social security benefits. As with the state pension, it is up to you to claim Pension Credit.
For those who are entitled to receive it, claiming Pension Credit is also really important because it acts as a gateway to other benefits, such as help with heating costs, housing benefit, dental treatment and free TV licenses (if you are aged 75 or over).
