- A trial launched by the government today will aim to encourage more people to claim valuable Pension Credit income top-ups (Trial encourages low-income pensioners to apply for extra financial support - GOV.UK (www.gov.uk))
- Two thousand people across Great Britain will receive letters inviting them to apply for Pension Credit as part of the initiative
- Trial is aimed at people most likely to be eligible for Pension Credit – namely individuals above State Pension age and in receipt of Housing Benefit
- The DWP has previously estimated up to 850,000 eligible households a year fail to claim Pension Credit
- Pension Credit is worth around £3,500 a year on average to those who claim it, according to the DWP
- Pension Credit also unlocks various other benefits – including cost-of-living payments targeted at low-income households
Tom Selby, head of retirement policy at AJ Bell, comments:
“Pension Credit is an extremely valuable but chronically underclaimed benefit available to low-income households in the UK. The fact the government is finally trying to address this problem with a practical intervention is welcome, if long overdue.
“Previous government estimates suggested up to 850,000 low-income households that could be eligible for Pension Credit were potentially missing out on £3,500 extra income a year on average because they failed to make a claim.
“This is tragic enough on its own given the financial strain many of these people will be facing, but made even worse because those who do not claim Pension Credit risk missing out on cost-of-living payments, as well as a string of other valuable benefits. The next two cost-of-living payments this year are worth a combined £600 – money which could be the difference between making ends meet and not for many people.
“If the trial is successful, the government must work rapidly to expand it across the entire country. However, the government could and should do more.
“A Freedom of Information request last November showed a backlog in processing Pension Credit claims. Administrative snarl ups shouldn’t stop pensioners from getting the help they need as quickly as they could. The government also needs to keep striving to make sure people are clear about when they can claim, myths are dispelled, and the claim process is as simple as possible.
“Anyone unsure about whether they qualify for Pension Credit can check their eligibility online, over the phone or by post. If you are unsure how to go about completing your application, organisations like Age UK and Citizens Advice can help.”
Pension Credit explained:
Pension Credit is a key benefit provided by the state which often tends to go unclaimed by lower income retirees.
In 2023/24, if you are over State Pension age (66), single and your income is less than £201.05 a week then Pension Credit will top you up to that amount. For a couple, the combined income figure is £306.85.
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).
In addition, those who claim Pension Credit currently qualify for cost-of-living payments from the government.
