With less than 2 months to go till the deadline for applying for the winter fuel payment this year (December 21), we ask ‘What will the consequences be following the announcement back in July, that not all pensioners would now be eligible to receive this benefit?’.
Why were there changes made to the system?
It was felt that many well-off pensioners were in receipt of a benefit they didn’t need, with Chancellor Rachel Reeves, and other members of The Labour Party, having defended the decision. Many campaigners for older people believe that the threshold is too low, and approximately 2 million vulnerable pensioners are at risk of missing out.
What are the key changes to the system?
To now be eligible to receive the payment, pensioners (aged 66 and over) must also be eligible for, and claiming, pension credit, and there are certain criteria to be met to be eligible for this.
What is the pension credit criteria?
Resident in England, Scotland or Wales
Have reached State Pension age
Include your partner, if applicable, on the application
Your income is less than £218.15 per week (single person) or £332.95 (couple) - Income includes State Pension, other pensions, earnings from employment and self-employment, and most social security benefits
£10K or less in savings and investments
Anyone receiving the full rate of the new State Pension of £221.20 will be ineligible. This may differ if, for instance, you have a disability, carer responsibilities or have high housing costs.
Are there any other benefits of claiming pension credit?
Yes! Alongside receiving pension credit (subject to eligibility above), it can also provide access to the following:
Housing benefit
Mortgage support
Free TV licence
Assistance with NHS dental appointments
So, back to the original question!
What’s going to happen to those not eligible for pension credit and, therefore, the winter fuel payment?
With more and more people on low incomes (45% according to a survey undertaken on behalf of National Energy Action) already struggling to pay their energy bills, with some households with prepayment meters having gone without power or heating when required, approximately 6M UK households will be in fuel poverty, when around 10% of annual income is needed for electricity and gas. According to Ofgem, the current total UK household energy debit is £3.7bn.
So, as the days get shorter, and the nights get colder, pensioners not eligible for the winter fuel payment will no doubt choose not to heat their homes, cook hot food or even reduce their use of essential medical equipment, leaving them vulnerable to the elements.
According to Simon Francis, coordinator of the End Fuel Poverty Coalition, this winter will feel like the most expensive on record, with even more energy price increases to come. Disability Wales’ Chief Executive, Rhian Bowen-Davies, has stated the changes to the winter fuel payment system could result in an additional 4,000 deaths this winter.
Is there more that can be done?
There is the Government’s Warm Home Discount Scheme available, which is a £150 one-off discount automatically applied to bills by the electricity supplier, for eligible households in England and Wales. To qualify, you either need to:
Be in receipt of the Guarantee Credit element of Pension Credit
Be on a low income and have high energy costs
If a household is on prepayment or pay-as-you-go meters, they would need to speak to their electricity supplier to find out how they would receive the discount, if eligible.
There are also plans in place to improve energy efficiency, but this will take time, and comes amid reports the energy industry has made profits of over £457bn since the energy crisis began. The Citizens Advice Bureau reports people are not receiving enough customer service from energy suppliers and they need to up their game so that customers can get the support needed during the colder months.
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