Money-saving expert Martin Lewis has appealed to pensioners before the changes come into force. In the most recent weekly email fork, Lewis alerted the pensioners to check about the Winter Fuel Payment, whose threshold of eligibility has been elevated.
Changes to Winter Fuel Payment Eligibility
This winter marks a shift in eligibility for the Winter Fuel Payment; a payment that had previously been paid to all pensioners from 1997. The new regulations mean that the payment will only be made to those pensioners who meet the Pension Credit conditions, which leaves most of them high and dry.
Lewis estimated that out of about 880,000 pensioners who are entitled to claim pension credit support, around 500,000 are likely to miss out because they don’t claim the support. Not only will they forgo the Winter Fuel Payment, but they will also forfeit other incentives such as a free TV licence, reduction on the council tax, and help with energy bills.
How to Check Eligibility
Lewis urged pensioners to check with the Department for Work and Pensions (DWP) if they think they qualify for Pension Credit. This can be done online or over the phone. Individuals will need their National Insurance number and details of their income and savings on hand.
Pension Credit supplements a single pensioner’s weekly income to £218.15, or £332.95 for couples. Lewis advised that even pensioners earning slightly above these amounts should check their eligibility. For example, single pensioners earning under £235 or couples with a combined income of under £350 should still verify if they qualify.
Potential Impact of New Rules
The new eligibility requirements, announced by Chancellor Rachel Reeves, are part of broader government efforts to reduce a £22 billion deficit in public spending. Reeves expressed regret over the decision, attributing it to financial challenges inherited from the previous administration. However, many charities and advocates have criticized the narrow criteria, arguing it could leave numerous pensioners without essential winter support.
According to Lewis, the most vulnerable pensioners, particularly those with incomes under £11,400, are the only ones assured to receive the payment. He warned that many pensioners who rely on the Winter Fuel Payment to heat their homes during the colder months could face hardship, particularly those just above the Pension Credit threshold.
A significant issue is the chronic under-claiming of Pension Credit. Despite a recent government awareness campaign encouraging pensioners to check their eligibility, take-up rates have never exceeded two-thirds in the last decade.
Age UK estimates that around two million pensioners will lose access to the Winter Fuel Payment under the new rules, with nearly a million of these being slightly above the eligibility threshold.
Moreover, around 800,000 pensioners are entitled to Pension Credit but do not claim it, often due to lack of awareness, the complexity of the process, or stigma. Lewis noted that the recent increase in the Pension Credit threshold, which rose by 8.5% in April, makes it worthwhile for pensioners who were previously rejected to apply again.
Lewis’s Upcoming Meeting with the Chancellor
Martin Lewis, who has been vocal about the changes, is scheduled to meet with Chancellor Rachel Reeves next week to discuss the implications of the decision. In August, he urged ministers to reconsider, stressing that many pensioners who narrowly miss the income threshold will face significant challenges without the payment. He emphasized that the under-claiming of Pension Credit could leave those most in need in severe financial distress.
Charity organizations, such as Age UK, have echoed these concerns, warning that the new eligibility rules could leave millions of pensioners struggling to heat their homes during the winter months.