Pension Credit – a missed lifeline for many

Many pensioners are struggling with rising costs, yet billions of pounds in benefits go unclaimed each year. In fact, in 2024 alone, an astonishing £22.7bn worth of benefits and financial support went unclaimed in the UK![1] 

With the recent restriction of the Winter Fuel Payment and the latest figures showing that there are nearly two million pensioners in the UK living in poverty, many could be missing out on vital support. 

 Hannah Taylor, Chief Executive Officer at Age UK Cheshire, feels that this is definitely the case:

“The latest figures show that there are nearly two million pensioners in the UK living in poverty, yet around £2.8 billion of Pension Credit and Housing Benefit is unclaimed in a single year. With prices continuing to be so high for everyday items it’s more important than ever that people receive their full entitlements.” 

Why are the benefits left unclaimed? 

Hannah sheds light on the obstacles preventing eligible individuals from claiming:

“We often hear that two major barriers are the belief that they won’t qualify and the perception that the process is too complicated.” 

 Last August, the DWP (Department of Work and Pensions) issued a press release urging pensioners to check their eligibility [2]. Martin Lewis also emphasised the importance of claiming. But, what exactly is Pension Credit? [3]

 What is Pension Credit? 

Pension Credit is a benefit provided by the UK government to help people over State Pension age with low incomes. It aims to top up their weekly income to a minimum level and is made up of two elements: 

 Guarantee Credit 

Guarantee Credit ensures that pensioners have a minimum level of income. If your weekly income is less than £227.10 for a single person or £346.60 for a couple, Guarantee Credit will top it up to these amounts (tax year 2025/26). 

 Savings Credit 

Savings Credit is like a reward for pensioners who have been savvy and saved for their golden years. It’s available to those who reached State Pension age before 6 April 2016. 

Savings Credit can provide up to £17.30 per week for a single person or £19.36 per week for a couple (tax year 2025/26). The only criteria to apply is to live in England, Scotland, or Wales, and be of State Pension age or if you’re a couple, you must have both reached State Pension age. Outside of location and age, all other applications will be assessed on a case-by-case basis. 

At Equilibrium, we aim to raise awareness about Pension Credit. While our clients may not qualify, they can still advocate for others who might be facing financial hardship. For those individuals, this extra income could be a lifeline. 

More than just extra income 

The benefits don’t stop there; for those who qualify, it can also lead to help with NHS costs, Cold Weather Payments, Housing Benefits, Council Tax Reductions, and even free TV licences. 

Breaking down stigma 

However, Hannah finds that even those who know about Pension Credit may have negative attitudes towards benefits:

“Some pensioners do not like the idea of asking for help or feel they can manage with what they have; even if that means cutting back on things like heating and food. But a call to Age UK Cheshire could start to unlock benefits people are legally entitled to.” 

So, even if you’re not comfortable having the conversation with friends, Age UK Cheshire may be able to help, and over the last year, they have supported older people to access over £1million of benefits they were entitled to. For more information, please call Age UK Cheshire on 01606 305 001 or email enquiries@ageukcheshire.org.uk. 

Alternatively, if you’d like to volunteer and help make a big difference, Age UK is always on the lookout for suitable volunteers in all areas of expertise and skills. If you are interested, please email volunteering@ageukcheshire.org.uk.

By spreading the word, we can help ensure that fewer pensioners struggle unnecessarily. Whether it’s for a friend or family member, a simple eligibility check could change someone’s life. 

How to apply for Pension Credit 

Thankfully, it is relatively straightforward to apply, as outlined in the steps below: 

 1.   Gather necessary information: National Insurance number, information about income, savings, investments, and pension. 

2.  Pensioners can apply in one of three ways:

By phone: Call the Pension Credit claim line on 0800 99 1234. 

By post: Request a form from the government website or by calling the claim line. Complete and send it to Freepost DWP Pensions Service 3 (no postcode or stamp required). 

Online: Apply through the official government website: Pension Credit: How to claim. 

 3.  Complete the application: Provide all the required information accurately, including evidence of income, savings, and investments. If applying by post, ensure it is sent to the correct address. 

 After submitting a claim, the applicant will receive a letter informing them of the decision. If successful, they will start receiving payments, backdated to the date of the claim if applicable. And that’s it! By dedicating just a small amount of time, you can significantly improve a pensioner’s wellbeing. 

(1) www.bigissue.com 

(2) www.gov.uk 

(3) www.moneysavingexpert.com