- The winter fuel payment will be scrapped for most pensioners in a move expected to save the Treasury £1.5 billion per year, chancellor Rachel Reeves has announced (Chancellor: I will take the difficult decisions to restore economic stability - GOV.UK (www.gov.uk))
- Those in receipt of Pension Credit, Universal Credit, Income Support, income-based Jobseeker’s Allowance and income-related Employment and Support Allowance will continue to receive winter fuel payments, the chancellor said
- Under the previous rules, anyone born before 22 September 1958 would have been entitled to help with their fuel bills during the winter months
- The winter fuel payment is worth up to £300 a year, with the exact amount dependent on your age and whether other people in your household also qualify
- Decision means it’s even for more important low-income pensioner households entitled to Pension Credit make a claim
Tom Selby, director of public policy at AJ Bell, comments:
“Chancellor Rachel Reeves’ axe unexpectedly fell on most pensioners’ winter fuel payments today, with only lower income retirees in receipt of benefits or income support set to qualify for the payment this year. Given the winter fuel payment is worth up to £300 a year, this will represent a significant hit on the incomes of millions of retirees.
“The shock move will mean it is even more important low-income households entitled to Pension Credit make a claim this year. Worryingly, the latest government estimates* suggest just 6-in-10 people who are eligible for Pension Credit make an application, potentially costing those on the lowest incomes thousands of pounds in lost income. Pension Credit also acts as a gateway to other valuable benefits, including dental treatment and free TV licenses.
“It is therefore absolutely vital the government scales up communications around Pension Credit to drive an increase in take-up. Failure to do this would risk leaving vulnerable pensioners in a desperate financial position when the cold hits.”
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).
*Source: Income-related benefits: estimates of take-up: financial year ending 2022
