Pension Credit is a vital benefit offered by the Department for Work and Pensions (DWP) that provides additional financial support to people over state pension age who are on low incomes.
Despite its importance in helping older adults cope with the rising cost of living, it remains one of the most underclaimed benefits in the UK.
Recent Trends in Pension Credit Claims
Last year’s changes to the Winter Fuel Payment eligibility helped raise awareness and encouraged thousands of pensioners to apply for Pension Credit.
However, new figures reveal that the surge in claims has now slowed, with applications falling by 16% compared to the same period last year.
Experts warn that eligible pensioners could be missing out on as much as £4,300 annually if they don’t claim.
Expert Warnings on Missed Entitlements
Lisa Picardo, Chief Business Officer UK at PensionBee, highlighted the scale of the issue. She noted that around 700,000 pensioner households are still not claiming their entitlements, potentially losing up to £4,000 each year.
According to her, Pension Credit not only provides essential income but also unlocks access to other forms of assistance such as cost of living payments, Winter Fuel Payments, housing benefits, council tax discounts, and free TV licences for over-75s.
Picardo urged for simpler claims processes, clearer communication, and a national strategy to increase take-up. She stressed:
“No one should fall into pensioner poverty because of administrative barriers or lack of awareness.”
What Does Pension Credit Provide?
1. Guarantee Credit
This is the main part of Pension Credit, designed to top up income:
- For single pensioners: income can be boosted up to £227.10 per week.
- For couples: joint income can be increased to £346.60 per week.
2. Savings Credit
For those who reached State Pension age before 6 April 2016, an additional savings credit is available:
- Up to £17.30 per week for single pensioners.
- Up to £19.36 per week for couples.
This applies if some money has been saved for retirement, such as through a workplace pension scheme.
3. Additional Elements
Pension Credit can also include extra support for carers, disabled people, or those responsible for children:
| Category | Extra Weekly Amount | Conditions |
|---|---|---|
| Severe Disability | £82.90 | Must receive certain disability benefits |
| Carers | £46.40 | If receiving Carer’s Allowance or Carer Support Payment |
| Children | £67.42 per child | Applies to dependents under 16 |
| First child born before 6 April 2017 | £78.10 | Higher rate applies |
Why Claiming Pension Credit Matters
Beyond the weekly financial boost, Pension Credit acts as a gateway to many other benefits. These include:
- Winter Fuel Payments
- Council tax discounts
- Housing benefit
- Free TV licences for over-75s
Failing to claim means missing out not just on direct income, but also on a wider safety net of support designed to protect older people from financial hardship.
Pension Credit is an essential benefit that can significantly improve the financial well-being of pensioners struggling with the cost of living. With claims currently down by 16%, many older households are missing out on support worth up to £4,300 per year.
Eligible pensioners are strongly encouraged to apply, as Pension Credit not only increases income but also unlocks access to a range of additional benefits.
FAQs
How much can Pension Credit increase my income?
If you’re single, it can raise your weekly income to £227.10, while couples can receive up to £346.60 jointly. Additional savings and disability-related credits may also apply.
Who is eligible for the savings element of Pension Credit?
You may qualify if you reached State Pension age before April 6, 2016 and have some retirement savings, such as a workplace pension.
What other benefits can Pension Credit unlock?
Claimants may also qualify for Winter Fuel Payments, housing benefits, council tax discounts, and a free TV licence for over-75s.