State pension crisis: 850,000 missing out on ‘life-changing’ £1.7bn in unclaimed funds

Up to an estimated 850,000 eligible households are still not claiming pension credit, raising fears that vulnerable people are unnecessarily suffering financial hardship. It is understood that as much as £1.7billion a year is being left unclaimed. Members of the public are being urged to check that older friends and relatives are not losing out on this boost to their incomes. From April 11, pension credit will top up incomes to a minimum of £182.60 per week for single pensioners and to £278.70 for couples.

Pensions minister Guy Opperman said: “We recognise the challenges some pensioners will be facing with the cost of living which is why promoting pension credit is a priority. That’s why we’re calling on everyone with retired family, friends and loved ones to check in with them and see if they can get this extra financial support.”

Today, more than 1.4million pensioners in Britain receive pensions credit, which also unlocks other benefits such as help with housing costs, council tax or heating bills, and a free television licence for those aged 75-plus.

Morgan Vine of Independent Age, said: “We know this support can be life-changing but for too long, too many people over 65 who are eligible have been missing out. Older people have told us that before receiving Pension Credit they would skip meals, struggle with a cold home and feel isolated, as they would turn down opportunities to see people because they couldn’t even afford a cup of tea in a café.  

“With the cost-of-living crisis making life even more harsh for people over 65, it has never been more urgent to take action on pension credit.”

The new publicity campaign will feature online and newspaper advertisements, leaflets will be distributed, and businesses can also use special resources to encourage eligible customers to call the department for work and pension’s “claim line”.

Caroline Abrahams of Age UK said: “Pension credit can make a big difference if you’ve reached state pension age and haven’t got much money coming in. With prices rising rapidly at the moment it’s more important than ever to claim what’s rightfully yours.

“We urge any older person who thinks they may be eligible to put in a claim and Age UK is here to provide advice and practical support to help you with the process.”

Describing pension credit as “something of a well kept secret” which “many people have simply not heard of,” she said: “That’s a real shame because at Age UK we see how much it helps those who actually receive it. [It] is really important for older people and deserves to be much better known.”

Research published last week found two out of three (66 percent) people starting their retirement this year do not expect to give up work completely as living costs escalate – up from just 34 percent in 2020.

The survey of 2,000 people for investments and wealth management company abrdn found 32 percent of those who retired in 2021 who are still working have joined or are planning to join the “gig economy”, taking roles such as delivery drivers.