Important announcement about Pensions from Age UK

 

Age UK is calling on all pensioners living on a low income with a partner of working age to urgently check their eligibility for Pension Credit and Housing Benefit and put in a claim before the Government changes the rules on 15th May.

 

The change, sneaked out the evening before the ‘meaningful vote’ on Brexit, will see the right to claim Pension Credit and Housing Benefit – important tools in the fight against pensioner poverty – withdrawn from future claimants who happen to have a partner who hasn’t yet reached their own pensionable age, with potentially devastating consequences for all those affected.

 

 

The Charity is warning that by slashing the benefits that couples needing to claim benefits in the future by as much as £7,000 a year, the new policy will place some pensioners in the absurd position of being financially better off if they split up and live apart from their younger partner. This is because once the change is implemented, the older partner could be eligible for significantly more money by claiming Pension Credit as a single person than if the pair of them claim Universal Credit as a couple.

 

Although in theory this change will not impact on existing claimants the Charity is warning that if a so-called ‘mixed-age couple’ temporarily loses their eligibility for these benefits because of a change in their personal or financial circumstances, from May they will be unable to regain it and will be thrown back onto the Universal Credit regime, the problems of which are well documented.

 

Over recent years the means-tested benefit systems for pensioners and people of working age have been growing further apart. Some of the main differences are:

 

· The amount you receive: The standard rate of Pension Credit guarantee is paid at a higher level than the standard rate of Universal Credit and this gap has widened. Over recent years Pension Credit guarantee has been updated, at least in line with earnings, while working-age benefit levels have been frozen or increase restricted.

 

· How any earnings are treated: For Pension Credit, usually just £5 a week (£10 for a couple) of earnings from work are ignored after which earnings reduce payments £1 for £1. Under Universal Credit, earnings reduce benefit by a 63% taper. So, for example, if earnings rise by £100 a month, benefit reduces by £63.