"Low-income pensioners, who might just miss out on qualifying for pension credit and, consequently now, the winter fuel payment, are particularly at risk despite not being wealthy."
- Jon Greer, head of retirement policy at Quilter
New freedom of information data from the Department of Work and Pensions (DWP) shows that 271,761 pensioners have been refused pension credit following a claim since 2019.
The news comes following the Chancellor’s announcement that the winter fuel payment would now be made only to those on low incomes who received certain benefits such as pension credit.
The data shows that since the 2019/20 tax year up to 31st July 2024 the DWP received a total of 848,973 pension credit claims of which 572,565 were awarded. Therefore, around two-thirds (67%) of claims were successful over the period.
There was a 116% increase in the number of people claiming pension credit in 2022/23 compared to the year earlier. This was due to a sustained marketing campaign from the government to increase the number of applicants so that more low-income pensioners could benefit from cost-of-living payments and a higher income.
To successfully get pension credit in the UK, claimants must have reached State Pension age and live in the UK, with a weekly income of below £218.15 for single applicants or £332.95 for couples. People with a disability or caring responsibilities could still qualify with a slightly higher income.
For those with savings and investments over £10,000, each £500 above this amount counts as £1 in additional income per week when calculating eligibility. For example, if you have £11,000 in savings, this counts as £2 income a week.
Pension Credit is made up of two parts: guarantee credit which tops up weekly income to the minimum guaranteed level, and savings credit which is a small top up for people who reached state pension age before 6 April 2016 who have a modest amount of income or savings.
Those receiving pension credit may be eligible for several additional benefits, such as a free TV licence for over 75s and help with rent through housing benefit and a discount on council tax.
Jon Greer, head of retirement policy at Quilter, commented: “There is a real concern that the “difficult decisions” made by the new Labour government could significantly impact Britain’s poorest. Low-income pensioners, who might just miss out on qualifying for pension credit and, consequently now, the winter fuel payment, are particularly at risk despite not being wealthy.
“Another worry about the new policy is that many pensioners may still be unaware of their eligibility for pension credit. It is evident that when the government actively promotes pension credit, there is a noticeable increase in the number of applicants, which is positive. However, with a third of pensioners who apply for pension credit being refused, there is considerable confusion over who is eligible.
“Following the announcement regarding the winter fuel payment, we know that the number of claims has risen due to the negative headlines, but the government to continue with this policy effectively must invest considerable effort into further promoting the application process and its benefits or risk literally living pensioners out in the cold this winter.”
