Pension Credit uptake remains stagnant, with around 1.4 million claimants as of August 2024.
According to new figures from the Department for Work and Pensions (DWP), this marks a decline of 11,000 recipients compared to the same period last year and 24,000 fewer than in 2022. Additionally, only 63 per cent of eligible individuals claim pension credit.
Meanwhile, Chancellor Rachel Reeves announced last month that most pensioners, except those on Pension Credit, will no longer receive winter fuel payments this winter. These payments can be worth up to £300 annually, depending on age and household circumstances.
AJ Bell director of public policy Tom Selby says: “The latest figures from the DWP suggest Pension Credit uptake remains stagnant compared with the previous two years, with just under 1.4 million claimants in February of this year. The actual number of claimants fell by 11,000 compared with the same period in 2023 and is down by 24,000 since 2022, highlighting the significant challenge facing the government in increasing uptake before universal winter fuel payments are scrapped later this year.
“Reeves’ axe unexpectedly fell on most pensioners’ winter fuel payments when she addressed the ‘black hole’ in the country’s public finances at the end of July, 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.
“Although these figures don’t cover the period since the chancellor announced the shock withdrawal, the fact the number of Pension Credit claimants has been gradually falling over the past two years presents a concerning picture for pensioners who most need support from the government but who may not be aware they need to claim. These figures also indicate that the government’s efforts to encourage more eligible pensioners to claim Pension Credit in June last year failed to increase the number of claims, meaning any new campaign will likely need additional backing from the government if it is to genuinely make a difference.
“The move means it is even more important that 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.
“The chancellor has also indicated plans to amalgamate pension credit and housing benefit in order to drive increased take up**, but the benefits system is incredibly complex so this may not be a simple fix. It is imperative the government gets this right to ensure people don’t miss out on this crucial benefit.”