Pension Credit helps to boost the income of the poorest pensioners, however, data shows the take-up this year has dropped, meaning millions of families have gone without.
In the financial year end (FYE) 2022, an estimated 63 percent of families who were entitled to Pension Credit received it. But this is down from 66 percent of families in FYE 2020.
Up to £2.1 billion of available Pension Credit went unclaimed. On average, this amounted to around £2,200 per year for each entitled family.
The DWP has produced the latest Pension Credit take-up data which is not normally noteworthy, however, “today’s publication is an exception,” an expert has stated.
The average weekly amount of Pension Credit is around £67 – or more than £3,500 a year – according to government figures.
Steve Webb partner at consultants LCP said the data shows a “deeply worrying drop in pension credit take-up amongst younger pensioners”.
Pension Credit acts as a ‘safety net’ benefit, ensuring that those who claim it are brought up to a minimum standard of living.
It also acts as a ‘gateway’ to other benefits such as help with energy costs, extra payments during periods of cold weather and, for the over 75s, free TV licences.
Mr Webb said: “The drop in Pension Credit take-up is deeply worrying. Despite a range of publicity campaigns, the message is simply not getting through.
“Pension Credit is a vital way of ensuring that people in retirement have a decent minimum standard of living. It seems likely that the link between Pension Credit and free TV licences for older pensioners has helped to sustain levels of take-up in that group, but the drop amongst younger pensioners must prompt urgent action.
“Many of those who do not take-up pension credit will be known to the government, for example through claiming other benefits such as housing benefit. Systematic use of the data government already holds is the best way to tackle this problem rather than one-off publicity campaigns”.
Claiming Pension Credit means people are entitled to a series of cost-of-living payments, which can make a huge difference in these difficult times. Quite simply, not claiming Pension Credit can leave one poorer to the tune of thousands of pounds.
These are enormous sums of money that could really boost people’s income in retirement, and it is vitally important that those who think they may be entitled to support check to see if they are entitled.
Helen Morrissey, head of retirement analysis at Hargreaves Lansdown explained there was a “shock dip” in Pension Credit take-up, with only 63 percent of families who are entitled to it actually claiming it.
The fact remains that hundreds of thousands of people who are struggling in retirement are not getting the help they need.
She said: “The Government has focused on increasing take-up of Pension Credit in recent years. One campaign was affected by the pandemic, but we have since seen a Pension Credit Day of Action in June 2022 which was aimed at boosting awareness of this vital benefit and the extra support it brings.
“It is hoped that the next set of data shows the fruits of this work with a surge in take up that means more pensioners are getting what they are entitled to.”
Pension Credit can top up weekly income to £201.05 if someone is single, and to £306.85 if they have a partner.
Britons can qualify for more if they are already being paid Carer’s Allowance or Attendance Allowance.
Pension Credit claimants can also get help with council tax, NHS prescriptions and glasses – as well as the potential for a free TV licence if they are over the age of 75.
Pension Credit claimants also qualify for a series of cost-of-living payments. The latest £300 payment will be paid from October 31.
