Under the new plans announced by the Chancellor, an estimated 10 million pensioners in England and Wales will not be granted winter fuel payments.
Reeves Trying to Close the £22 Billion Gap
Chancellor Rachel Reeves has been making the tough decisions that no one wants to make to close a £22 billion hole in the public finances that the Conservative government had covered up.
Cap on Social Care Costs for Pensioners
Amidst the decisions is a planned cap on social care costs and scrapping several major road and rail projects.
Winter Fuel Payment Started in 1997
The winter fuel payments are a state benefit introduced in 1997 to help those above state pension age with their winter heating bills.
First Winter Without Financial Aid From the Government
Winter 2024 will be the first time pensioners in England and Wales will not be eligible for the benefit if they aren’t on pension credit or other means-tested benefits.
Jumping Through Hoops to Qualify for Pension Credit
To qualify for a pension credit, you must be above the state pension age and have an individual weekly income of less than £218,15 or a combined weekly income of less than £332,95.
Savings Could Disqualify a Pensioner
Pensioners’ savings are also considered and could disqualify one even if the income is low. However, despite the income and savings criteria, if one is disabled, caring for someone, or has housing costs that need to be covered, they might qualify.
The Winter Fuel Payments Are a Lifeline to Many Pensioners
The annual winter fuel payments are worth between £100 to £300 and are tax-free, which can significantly benefit a pensioner.
11,4 Million Pensioners Received the Benefit
In the winter of 2022-23, payments were made to 11,4 million pensioners in 8,4 million households.
Winter Fuel Payment Was Paid Automatically
The winter fuel basic rate payment is usually automatically paid to anyone claiming a pension, with the higher rate going to those on benefits such as pension credit.
Poorer Households Received More Benefits
In the winter of 2023-24, extra costs of living payments were made to poorer households, and in some cases, they even increased to up to £600.
Around 10 Million Pensioners Affected
Removing this benefit from those not on pension credit would mean that around 10 million pensioners will be affected.
Scotland and Northern Ireland to Make Decisions on Their Own
Scotland and Northern Ireland must decide to follow suit and restrict winter fuel payments.
Scottish Government Upset They Weren’t Informed Before the Change
However, the Scottish government reported it was “deeply disappointing” that changes were made to the winter fuel payments “without any consultation or discussion” between ministers.
Pension Credit Pensioners Still Catered For
Reeves clarified that those on pension credit would continue to receive £200 per household or £300 for households with someone over 80 on pension credit.
“Cuts Have Gone Too Far”
AgeUK, a charity, has said that the cuts have gone too far, and some 2 million people who need the payments will no longer receive them.
Pensioners in a Pinch
They said that almost half the pensioners qualify for pension credit but don’t claim it, and about half have weekly incomes of less than £50 above the poverty line. They still don’t qualify for the benefits but rely heavily on the payments.
Reeves Trying to Undo the “Undisclosed” Spending
Ms Reeves has said she has had to make “urgent decisions” due to the previous governments’ “undisclosed” spending.
Coming Together to Get a Deal
She said the government will bring the administration of pension credit and housing benefit together “as soon as operationally possible.”
Housing Payment and Pension Credit Hold Hands
This will ensure that pensioners receiving the housing payment will get any pension credit that they are entitled to.
Featured Image Credit: Shutterstock / Rupert Rivett.
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