Recent government analysis suggests that hundreds of thousands of pensioners across England and Wales may miss out on crucial winter fuel payments. This development follows recent changes to the eligibility rules that mean only those receiving Pension Credit and certain other benefits will qualify. According to estimates released by the Department for Work and Pensions (DWP), approximately 780,000 pensioners could lose out because they are unlikely to apply for benefits they are entitled to.
The DWP’s analysis was made public through a Freedom of Information request. It paints a concerning picture: many pensioners, who could be eligible for Pension Credit and thus winter fuel payments, are expected not to claim. This is despite calls for the government to provide a full assessment of the impact of the changes, something it had not been legally obliged to do, according to Number 10.
The policy shift means that around 10 million pensioners will no longer be entitled to winter fuel payments, a significant change that has led to many pensioners feeling uncertain about their financial stability. A Treasury spokesperson assured the public that more than a million pensioners will still receive this support and stressed that the government is urging eligible pensioners to apply for Pension Credit through targeted campaigns.
However, the internal DWP analysis suggests that despite these efforts, more than three-quarters of a million pensioners are likely to miss out. While the government hopes that around 100,000 people will be persuaded to claim Pension Credit, many still will not, resulting in a large number of pensioners losing financial support during the winter.
The analysis revealed that older pensioners, particularly those over 80, would be disproportionately affected. This group currently receives a higher winter fuel payment of £300 compared to £200 for younger pensioners, meaning they would face a greater financial impact. Additionally, the findings indicate that while pensioners with disabilities are somewhat more likely to retain the payment, around 71% are still expected to lose it.
The changes have drawn criticism from various political figures and opposition parties. Conservative Party chairman Richard Fuller called for Labour to conduct a comprehensive impact assessment of what he described as a “harmful policy.” The Liberal Democrats also criticised the government for not conducting a full assessment before implementing cuts, labelling the move as “unthinkable.” In defence, Labour leader Sir Keir Starmer stated that the decision to cut winter fuel payments was necessary to stabilise the economy, though he acknowledged that efforts were being made to reduce the financial burden on affected pensioners.
The DWP has since clarified that the analysis released is not as extensive as a full impact assessment, which is why it was not routinely published alongside the policy changes. This lack of transparency has only fuelled criticism and confusion among pensioners, many of whom are concerned about the financial strain this winter will bring.
UK Pension Credit: Who Qualifies And How To Claim
For those who may be impacted by the loss of winter fuel payments, applying for Pension Credit could provide some much-needed financial relief. Currently, around 1.4 million people in the UK are claiming Pension Credit, highlighting the significant number of pensioners benefiting from this support. Pension Credit is a means-tested benefit available to people over the State Pension age who have a low income (Age UK). It has two components: Guarantee Credit and Savings Credit.
What Is Guarantee Credit?
Guarantee Credit helps to top up a person’s weekly income to a guaranteed minimum level. Currently, this means:
- £218.15 per week for single pensioners
- £332.95 per week for couples
This benefit ensures that people receive a basic level of income, which can be vital for those struggling to manage rising living costs.
What Is Savings Credit?
Savings Credit is an additional benefit for those who have some savings or a higher income than the basic State Pension. It is only available to people who reached State Pension age before 6 April 2016. Eligible individuals could receive up to:
- £17.01 per week if single
- £19.04 per week if in a couple
It is worth noting that Savings Credit is no longer available to newer pensioners, limiting its applicability to those who reached the qualifying age before 2016.
What Is The Eligibility For Pension Credit?
You may be eligible for Guarantee Credit if you have reached State Pension age, currently set at 66 for both men and women. If your weekly income is below the thresholds mentioned above, you could qualify for this top-up. Even if your income is higher, you might still be eligible if you meet other criteria, such as being a carer, having a severe disability, or having certain housing costs.
For Savings Credit, eligibility depends on whether you reached State Pension age before 6 April 2016. There is no savings limit for Pension Credit, but if you have over £10,000 in savings, the amount you receive may be reduced.
How To Apply For Pension Credit
Pension Credit can be claimed in several ways. The simplest method is online via the official government website if you already receive the State Pension and have no dependent children included in your claim. Alternatively, you can call the Pension Credit claim line on 0800 99 1234, and a representative can assist you with the application over the phone. Lines are open Monday to Friday, from 8am to 6pm.
Having certain details to hand can help streamline the application process, such as your National Insurance number, bank account details, and information about your income and savings. If you have a partner, their details will also be required.
Additional Support Available Through Pension Credit
Pension Credit does more than just top up your income. By claiming Pension Credit, you may become eligible for other benefits and financial support:
- Health Costs: Claimants may receive free NHS dental treatment and assistance with the cost of glasses and transport to a hospital.
- Housing Costs: Pension Credit can help with housing expenses. Many claimants do not need to pay Council Tax, and those who rent may have their rent covered through Housing Benefit. Homeowners may be eligible for help with mortgage interest or service charges.
- Carer and Disability Support: If you care for someone, you could receive up to £45.60 per week extra through the Carer Addition. People with disabilities may qualify for an additional £81.50 per week through the Severe Disability Addition.
- Other Benefits: Pension Credit recipients who are 75 or over can receive a free TV licence, and there is also eligibility for the Cold Weather Payment during extremely cold periods.
From winter 2024 onwards, the Winter Fuel Payment will only be available to those claiming Pension Credit or another means-tested benefit. This annual payment is crucial in helping many pensioners cope with increased heating costs during the colder months.
If you are eligible for Pension Credit, applying could make a substantial difference in terms of financial support. Many pensioners miss out simply because they do not realise they qualify, or they think their savings or income might disqualify them. There is no harm in applying, and even if you have been turned down before, you can still make a new claim each year.
Conclusion
The changes to winter fuel payment eligibility highlight the importance of understanding and claiming the benefits that are available. Pension Credit can provide a financial safety net, and claiming it could mean the difference between losing out and receiving vital help. For more information, visit the official Pension Credit page on GOV.UK or contact Age UK for assistance.
This article was brought to you by Ward Goodman, a leading accountancy firm in Dorset, providing financial services for businesses, private clients, and charities, including tax planning, inheritance tax, auditing, financial planning, and financial advisory services.
