Rachel Reeves has pledged to overhaul Britain’s pension benefit system after yesterday’s announcement that Winter Fuel Payments will no longer be made universal for pensioners with 10 million older Britons set to lose access to the benefit.
Older Britons are entitled to up to £300 in energy bill support through the scheme but this will now be reserved for those claiming means-tested from the Department for Work and Pensions (DWP), including Pension Credit, under the new Labour Government.
Experts have warned that 800,000 state pensioners, who would otherwise be entitled to the benefit, are not currently claiming it which could disenfranchise them accessing the Winter Fuel Payment.
Notably, Reeves has claimed Pension Credit will be combined with Housing Benefit to improve uptake among those who may be eligible.
Pension Credit is for those of state pension age who are on low income with single claimants and join claimants entitled to a top-up of £218.15 and £332.95 a week, respectively.
In comparison, Housing Benefit is used to help those on low income or out of work with their rent costs.
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Pension Credit is a benefit reserved for lower income pensioners GETTYSpeaking to BBC Breakfast, the new Chancellor defended her decision to make the energy bill support means-tested this year and outlined the Government’s plan going forward.
She explained: “We have preserved the Winter Fuel Payment for pensioners on Pension Credit. It is important for those who need it most.
“We’ll work with DWP to increase the take up of pension credit, so everyone who is entitled to it gets it.”
When asked if the decision to means-test the Winter Fuel Payment is a “blunt instrument”, Reeves noted how she hopes to boost application numbers for Pension Credit.
“We are going to merge Pension Credit with Housing Benefit to increase take up Pension Credit,” she added.
“And we’ll be working with older people’s charities and local Government to identify people who should be getting Pension Credit.
“Because I want everyone entitled to pension credits to get it, and also the Winter Fuel Payment”
Despite the Government’s commitment to improving uptake, 10 million pensioners are expected to lose access to the Winter Fuel Payment this year.
Caroline Abrahams, the charity director at Age UK, described the decision as a “social injustice”.
She explained: “It is well established that pensioners tend to do everything possible to avoid going into debt, so if they are worried about their future energy bills, we know their likely response will be to ration their fuel use and economise by reducing their spending on other essentials.
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“This proposed policy change is therefore certain to result in more older people experiencing a horrible ‘eating or heating’ dilemma.
“Means-testing the Winter Fuel Payment this winter, with virtually no notice and no compensatory measures to protect poor and vulnerable pensioners, is the wrong policy decision, and one that will potentially jeopardise their health as well as their finances – the last thing they or the NHS needs.
“With winter now just over the horizon, the Government should halt their proposed change to WFP and think again, given the clear evidence of how it will hurt the older people who need it the most.”
GB News has reached out to the DWP and the Treasury for comment.