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Age UK warns of devastating impact of policy announcement that will leave pensioners thousands of pounds worse off

Published on 15 January 2019 04:25 PM

Following the Government’s quiet announcement last night that from May 15th 2019 ‘mixed age couples’ – where one partner is of working age and the other is above State Pension age – will no longer be entitled to put in a new claim for Pension Credit, Age UK is warning that this could leave some of the poorest pensioners paying a hefty price for having a younger partner, with mixed age couples potentially losing out on around £7000 per year.

The Charity is warning that the Government’s policy change effectively means that many pensioners might find themselves in the absurd position of being financially better off if they split up and live apart from their partner. This is because once the change is implemented, the pensioner partner will, in many cases, actually be eligible for more money from their Pension Credit than they and their partner will get together from Universal Credit.

Commenting on the announcement, Caroline Abrahams, Charity Director at Age UK, said: “You could be forgiven for missing this announcement, since the Government used the most low key mechanism possible, a Written Ministerial Statement, late afternoon on the day before today’s ‘meaningful vote’, to bury the bad news. And make no mistake, this is very bad news for everyone affected. It’s a substantial stealth cut – a couple claiming in the future could receive £140 less per week than an older mixed couple claiming before the change comes in.”

Age UK is warning that although in theory this change will not impact on existing claimants – only new ones – if a mixed age couple temporarily loses their eligibility for Pension Credit then from May 15th they will be unable to regain it and will be thrown onto the Universal Credit regime, the problems of which are well known. This could happen simply because the pensioner partner travels abroad to see relatives for just over four weeks.

According to Age UK’s Caroline Abrahams: “Last week the new Secretary of State at the DWP, the Rt Hon Amber Rudd MP, made a speech about the future of Universal Credit that was widely praised as thoughtful and compassionate. We are very disappointed that only a few days later, her Department has quietly announced a measure which will hit the older couples affected very hard, undoubtedly pushing more into poverty.

“It is by no means unusual for one partner to be slightly older than the other within relationships and the bigger the age gap between them, the more long-lasting the adverse impact on them will be because of this proposed change. That’s why this Government policy has been dubbed ‘the toy boy tax’ by some – but that’s not to trivialise the really serious impact it is likely to have on anyone unlucky enough to be subjected to it. For some, the impact will be truly devastating. The Government should think again.”

Any older person who is worried about money or thinks they may be entitled to claim Pension Credit or other pensioner benefits can call Age UK Advice free of charge on 0800 169 6565, visit www.ageuk.org.uk or contact their local Age UK for further information and advice.

-- Ends --

Notes to editors:

[i] Older households are defined as households with at least one person aged 60 or over.

[ii] 2022-23

[iii]Age UK analysis of Living Cost & Food Survey 2019-20. Figures projected to 2022. Spending patterns are assumed to be the same as those in 2019-20. Prices of items are changed in line with ONS inflation output figures for the years to 2021-22, and then by 9-10% to the year 2022-23 for all items except for energy that are increased by the rise in the energy price cap of 54% in April 2022 and an assumed rise of 40% in October 2022. Household income are changed in line with output data (to 2021-22) and then forecast figures (to 2021-22) and then 3.1% for households whose main source of income is benefits and 4.42% for other households (to 2022-23). 

[iv] By poorest older households we are referring to those older households with the lowest household income after-tax (i.e. those in the lowest income decile).

[v] Age UK analysis of Living Cost & Food Survey 2019-20. Figures projected to 2022. Spending patterns are assumed to be the same as those in 2019-20. Prices of items are changed in line with ONS inflation output figures for the years to 2021-22, and then by 9-10% to the year 2022-23 for all items except for energy that are increased by the rise in the energy price cap of 54% in April 2022 and an assumed rise of 40% in October 2022. Household income are changed in line with output data (to 2021-22) and then forecast figures (to 2021-22) and then 3.1% for households whose main source of income is benefits and 4.42% for other households (to 2022-23). 

[vi] Office for National Statistics (ONS) 2022. Coronavirus and the social impacts on Great Britain: Household finances. Datasets: 19 November 2021 to 1 April 2022. Available at: https://www.ons.gov.uk/peoplepopulationandcommunity/healthandsocialcare/healthandwellbeing/datasets/coronavirusandthesocialimpactsongreatbritainhouseholdfinances.

[vii] Those in receipt of Pension Credit, which can be backdated for three months and tops up the weekly income of a single pensioner to £182.60 or a pensioner couple to £278.70, (or higher in some circumstances) could also be entitled to the following:

  • A Cold Weather Payment of £25, paid automatically when the average temperature is 0°C or below over seven consecutive days
  • £140 off electricity bill thorough the Warm Home Discount Scheme, if eligible
  • A free TV licence (if also over-75)
  • Free NHS dental treatment and help towards the cost of glasses and travel to hospital
  • Help with Council Tax
  • Help with rent
  • Cheaper phone and home broadband deals
  • Reduced water bills
  • An extra amount of Pension Credit for some carers worth up to £37.70 a week.

For more information

Contact the Age UK Media team on 020 3033 1430 during office hours (Mon-Fri 08:30-17:30) or for out-of-hours media support please email media@ageuk.org.uk 

See media contacts

Age UK

We work with our national partners, Age Scotland, Age Cymru and Age NI and our local Age UK partners in England (together the Age UK Family). We also work internationally for people in later life as a member of the DEC and with our sister charity Help Age International.

Age UK believes that everyone should have the opportunity to make the most of later life, whatever their circumstances. We provide free information, advice and support to over six million people; commercial products and services to over one million customers; and research and campaign on the issues that matter to people in later life. Our work focuses on five key areas: money matters, health and well-being, home and care, work and training and leisure and lifestyle.

Age UK is a charitable company limited by guarantee and registered in England (registered charity number 1128267 and company number 6825798). Age Concern England and Help the Aged (both registered charities), and their trading and other associated companies merged on the 1st April 2009. Together they have formed the Age UK Group ("we"). Charitable services are offered through Age UK and commercial products are offered by the Charity's trading companies, which donate their net profits to Age UK (the Charity).

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Last updated: May 11 2022

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