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One million households will miss out due to the Winter Fuel Payment changes

Published on 04th August 2024

The Chancellor’s removal of the Winter Fuel Payment for older people not claiming Pension Credit highlights the importance of boosting take up of this underclaimed benefit.

In new exclusive analysis published in The Observer today, Policy in Practice estimates that:

Over 850,000 older people are eligible for but not claiming Pension Credit
An estimated 130,000 older people miss out because they are just £500 over the income threshold to claim Pension Credit. They could be better off by having lower income and claiming Pension Credit and the Winter Fuel Payment

Social policy data analytics company Policy in Practice uses administrative data to help local authorities find residents who need support, identify unclaimed benefits and better direct local discretionary support, such as the £1 billion Household Support Fund.

Policy in Practice works to resolve issues such as the cliff edges, low awareness, complexity to claim and stigma around social security that result in UK households missing out on an estimated £23 billion of unclaimed support each year.

850,000 people are eligible but not claiming Pension Credit. These households miss out on passported support such as the Winter Fuel Payment, alongside Pension Credit. They could be missing out on more than £10,000 a year overall.

Simple black and white text based graphic with headline at the top saying Over 850,000 eligible pensioners are missing out on Pension Credit today. Beneath the headline is two columns, text on the left and a table on the right lists the value of benefits that pensioners are missing

Policy in Practice found that local authority led take up campaigns can narrow the take up gap. A recent London wide takeup campaign commissioned by the Greater London Authority saw over 2,300 previously unaware households take up Pension Credit. Each household became better off by an average of nearly £4,000 a year as a result of the campaign.

Locally led takeup campaigns were found to be more than twice as effective as national campaigns. Their project is expanding, operating across over sixty councils this year to drive takeup of Attendance Allowance, Free School Meals, Healthy Start and social tariffs.

The founder of Policy in Practice, Deven Ghelani, was one of the architects of the Universal Credit system. He said:

Taking the Winter Fuel Payment from better off pensioners is one of the few reasonable ways to save money in social security, particularly as they benefit from the triple lock. However, there really is no excuse for the shockingly low levels of Pension Credit take up as many older people continue to struggle with the cost of living.

The Secretary of State should prioritise simplicity in the benefit system and promote proactive support for people. The DWP could start by sharing data with local authorities and widening legislation to allow for automated take up campaigns for benefits such as Pension Credit. If Universal Credit data were shared more widely, we could boost incomes while lowering administration costs.