‘Vital need for pensioners to check eligibility’ as millions miss out on DWP benefit worth £3,900 a year

Chancellor Rachel Reeves last month announced that winter fuel payments would be scrapped for most pensioners this winter, with those receiving Pension Credit among those to continue getting the benefit.

The benefit has become all the more important following these changes, pushing experts to shed light on the fact that uptake is low, when thousands of pensioners can benefit from the boost.

Jon Greer, head of retirement policy at Quilter said: “Linking winter fuel payments to a benefit which appears to have just 60 per cent take up has drawn broad consternation

“Pension credit has become all the more important following the Labour government’s changes to the winter fuel payment which mean it will only be paid to those claiming pension credit or other means tested benefits, so it is vital that pensioners on low incomes check their eligibility.”

Pension Credit gives people extra money to help with their living costs if they’re over state pension age and on a low income. It can also help with housing costs such as ground rent or service charges.

In 2024/25, if someone is over state pension age (66), single and their income is less than £218.15 a week then Pension Credit will top them up to that amount. For a couple, the combined income figure is £332.95.

Nearly 1.4 million older people across Great Britain, are currently receiving the means-tested benefit that could provide an average of £3,900 in support during the year ahead.

However, the latest figures from the DWP suggest there are still 880,000 eligible pensioners not claiming the benefit they are entitled to.

Tom Selby, director of public policy at AJ Bell, said: “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”.

The latest figures from the DWP show the actual number of Pension Credit 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.

Selby continued: “These figures 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 low-income households entitled to Pension Credit make a claim this year.”

Around six-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.

An online pension credit calculator is available and can provide an estimate of the potential benefits people may be eligible for, and the application process is simple and can be done online, by post or by calling 0800 99 1234.

The latest DWP estimates show that 40 per cent of those entitled to claim the benefit don’t and just 73 per cent of the total amount of pension credit that could have been claimed was actually claimed.

Britons must live in England, Scotland or Wales and have reached state pension age to qualify for Pension Credit.

If someone has £10,000 or less in savings and investments this will not affect their Pension Credit.

If they have more than £10,000, every £500 over £10,000 counts as £1 income a week.

A DWP spokesperson said: “Ensuring a better deal for the pensioners of today and tomorrow is a priority for this government.

“We have committed to the Triple Lock and are promoting Pension Credit and its benefits such as help with heating costs to protect pensioners on the lowest incomes.”