How one million pensioners are missing out on crucial government support

A Lords debate showed the Tories have no plan to address the problem, writes Natalie Bennett.

Even our current government likes to talk about pensioners as the deserving poor – despite members of its party take a very different attitude when it comes to hungry school children.

It’s particularly shocking then to find that in the past decade, no progress has been made in ensuring that pensioners who need extra financial support receive it.

The mechanism by which this is supposed to be achieved is pension credit, a top-up payment applied for when state pension income is inadequate. The state pension is often insufficient because people have taken on unpaid caring responsibilities (no prizes for guessing which gender that usually falls to), suffered from ill health, or simply been on low pay.

On average single claimants get £58 a week with couples receiving £80. For people on low incomes, missing out on sums like that is going to be severely damaging.

But the rate of take up among those eligible has stayed at around 60% over the past decade, with more than one million eligible people missing out, at an annual collective cost of almost £3 billion. Only about 1.5 million people get the help they need.

Research conducted by Loughborough University academics estimates that low uptake of pension credit costs the Government £4 billion a year in increased NHS and social care spending – so even looked at in the narrowest of Conservative terms, this is a problem that should be fixed.

Pension credit also opens up access to other benefits such as council tax reductions, the cold weather payment, and housing benefit. In total we are talking about many pensioners missing out on £7,000 a year.

Research shows four in ten people have never even heard of pension credit, so lack of knowledge is one barrier to application. But there is also a stigma – utterly unwarranted but nonetheless there – with more than 60% of eligible non-recipients agreeing in a survey that they “did not like asking for benefits”.

Independent Age is calling for a clear, long-term strategy to increase take-up. I can only concur. Auto-enrolment was trialed a decade ago and not judged a success. But technology and the range of digital data has developed since then, and it is surely worth looking at again.

In oral questions on Monday in the House of Lords, there was little cause for optimism about progress. Responding to a question from Lord Foulkes of Cumnock (Labour), the minister did indicate she might be prepared to meet with charities and campaigners to discuss the potential for a shared publicity campaign. But that was about as positive as it got.

No plans for a concerted government plan, no plans for further work on auto-enrolment. The word disappointing hardly covers it.

The minister did get put under real pressure on the issues I’ve highlighted above, but unfortunately I didn’t get to ask a question: pressing the government to look at system change, rather than just fixing the current broken arrangements.

Because the case of pension credit is an illustration of the innate problem of means-tested benefits, particularly ones that people have to apply for. Some who need them, who are entitled to them, will always miss out.

The only way to ensure that does not happen – that pensioners are not living in poverty, suffering unnecessary ill-health and misery – is to have a universal basic pension adequate for everyone’s needs. (That’s Green Party policy, by the way.)

New Zealand has that. And speaking to experts on the Universal Basic Income at a recent international conference, I learnt how, even during periods of extreme neo-liberal government, no one dared to seriously try to take it away.

It is extraordinarily popular in New Zealand. And why not: a universal benefit to ensure no pensioner, no one in their older years, when they cannot be expected to support themselves, is left in poverty. It would be simple and cheap to administer, with tax taking back the funds from those who do not need it.

A comprehensive plan to promote pension credit take-up would be good. An adequate, poverty-ending, universal pension would be much better.

Natalie Bennett is a Green Party peer in the Lords and a Contributing Editor to Left Foot Forward.

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