Pensioner poverty

Bath MP, Wera Hobhouse has pledged to help tackle rising levels of pensioner poverty.

Data, analysed by national charity Independent Age, has found that ,while poverty in the overall population has remained relatively stable since 2012, pensioner poverty has increased by 5% across the UK, with now almost a fifth of pensioners (18%) living in poverty after paying their housing costs.

Independent Age says these rising figures could be drastically reduced if people receive the financial support they are entitled to via Pension Credit – extra money designed to help with living costs for people over State Pension age and on a low income4. However, it has the worst uptake of all income-related benefits and has not risen above 64% for almost a decade.

In support, Wera Hobhouse has signed a cross-party letter to Pensions Minister, Guy Opperman MP, calling for the Government to produce an action plan to increase Pension Credit uptake. 

She said: “The fact that levels of pensioner poverty have crept back up to numbers not seen since 2012 is alarming and must be tackled.”

“Living in poverty can impact every area of a person’s life. No one should have to face impossible decisions on whether to heat their home or buy enough food to eat. That is why I am supporting Independent Age’s call for the Government to urgently come up with an action plan on Pension Credit.”

As well as topping up people’s income, Pension Credit also acts as a gateway to other forms of support, including Housing Benefit, a free TV licence (for people over 75), free NHS prescriptions, council tax support and free eye tests.Combined, this could be worth around £7,000 per year for an individual.

Independent Age estimates that in Bath alone, people in later life are missing out on a total of £2,418,808 in Pension Credit. As well as reducing poverty, improving uptake in Bath could deliver £4.1m (2018/19 figures) in savings to the Treasury because those eligible for Pension Credit but not receiving it often have health problems which require support from the NHS or state funded social care.

Previous research commissioned by Independent Age found that maximising Pension Credit uptake and ensuring everyone entitled to it receives it, could lift roughly 3 in 10 pensioners out of poverty and reduce the number living in severe poverty by half.

As part of its ‘Credit where it’s due’ campaign, Independent Age is calling for Pension Credit uptake to be improved since July 2019.

Earlier this month, the government backed a Pension Credit awareness day (16 June). The charity welcomes this as a positive step, but says awareness raising won’t be enough by itself, as the scale of the issue demands more urgent and innovative action.

Deborah Alsina MBE, Chief Executive of Independent Age, said: “Thank you to Wera Hobhouse for supporting our Credit where it’s due campaign.

“For too long, levels of pensioner poverty have been creeping back up and this ticking timebomb cannot be ignored.  

“The government statistics are clear, in 2019, up to £1.8 billion earmarked for the poorest people in later life through Pension Credit didn’t reach them.

“The government must urgently come up with a plan to increase the level of Pension Credit uptake, including effective and targeted awareness campaigns, research into who is missing out and why, improved communication to people who are eligible, and exploring options around auto-enrolment.”

For more information on Credit where it’s due, see here.