Older People’s Commissioner urges rethink on Winter Fuel Payment means testing

Wales’ Older People’s Commissioner has urged the Chancellor to reconsider plans to change the eligibility rules for Winter Fuel Payments.

The payments of up to £300 have been made available to everyone above state pension age.

However, from this winter pensioners will only receive a payment if they are receiving pension credit.

Thousands of older people in Wales will no longer be eligible to receive the payment following the introduction of the means test by Rachel Reeves.

The move is expected to reduce the number of pensioners in receipt of the payment in England and Wales by 10 million, from 11.4 million to 1.5 million, saving some £1.4 billion this financial year.

The payment is a devolved matter in Scotland and Northern Ireland.

Black hole

The Chancellor said she was making “difficult decision” in an attempt to fill a £22 billion black hole in the public finances left by the previous Conservative government.

“The announcement that the Winter Fuel Payment will now only be paid to those in receipt of Pension Credit is deeply concerning, as it means that thousands of older people in Wales will now miss out on crucial financial support,”Older People’s Commissioner for Wales, Heléna Herklots CBE, said.

“It is estimated that around 80,000 households in Wales miss out on Pension Credit despite being eligible, meaning older people are already missing out on over £200 million they are entitled to.

“The Chancellor’s decision would mean that these households could now also miss out on tens of millions of pounds more that could make a big difference in terms of people’s finances.

“I am also concerned about the older people in Wales who may be surviving on low incomes and struggling financially, but find themselves just above the Pension Credit threshold.

“These individuals already miss out on the crucial wider support unlocked by Pension Credit – such as council tax discounts – and will miss out on even more as a result of this decision.

“I would urge the Chancellor to reconsider this decision ahead of her budget to avoid driving more older people in Wales into poverty, and putting people’s health and well-being at risk, which could bring greater costs in the longer-term.”

Health

Age Cymru said it is extremely concerned means testing will have on older people across Wales.

Chief Executive, Victoria Lloyd said: “We know that thousands of households in Wales are failing to claim the £200million that they are entitled to in Pension Credit, so much more needs to be done to support these people to access what they are eligible for.

“Means-testing the Winter Fuel Payment in this way, gives pensioners little time to prepare and is a decision that will potentially jeopardise their health as well as their finances.

A decent income provides dignity and security, and helps people stay independent and active. A warm home, nutritious food, occasional treats and being able to get out and about are all good for health and wellbeing, helping older people to make the most of later life.

“This should not just be an aspiration but the experience of all older people across Wales.”

‘Too narrow’

Martin Lewis, founder of MoneySavingExpert, immediately warned the Government’s targeting of the payments was “too narrow with the winter we have coming”, adding: “The energy price cap is likely to rise 10% this October and stay high across the winter, leaving most energy bills nearly double those pre-crisis, at levels unaffordable for millions.

“Many pensioners eke out the £100 to £300 winter fuel payments to allow them to keep some heating on through the cold months.

“While there’s an argument for ending its universality due to tight national finances, it’s being squeezed to too narrow a group – just those on benefits and pension credit. Yet again, those just above the thresholds will be hardest hit.”

Mr Lewis added: “Plus, with this announcement, the Government has a huge moral imperative to ensure the 800,000 people eligible for pension credit who don’t get it, are informed, educated and helped through the process.

“It is planning an awareness-raising campaign, but it needs to ensure that reaches every corner – and, if possible, proactively and personally contact people.

“Pension credit is a crucial gateway benefit, giving access to a host of other entitlements, and now with the link to the winter fuel payment, it makes it even more important to ensure fewer miss out.”

Simon Francis, coordinator of the End Fuel Poverty Coalition, said: “When Rishi Sunak threatened to axe winter fuel payments in September 2023 we said that this could be a death sentence for pensioners who are only just about managing to keep out of fuel poverty.

“Nothing has changed. Energy prices are still high, people are still struggling with the cost of living and this dangerous decision by the Chancellor could condemn pensioners to living in cold, damp homes this winter.

“Figures for the Warm This Winter campaign suggest that around 41% of over-75s could now see their winter heating budget torn to shreds as they have modest incomes and will not now be eligible for the payment.

“The Chancellor must urgently think again and consult with older people’s charities on a better way to target this support to a wider group of pensioners.”