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Pensioners' lost millions

By Sally West, Income Policy Officer at Age Concern England, BBC News

 September 3, 2003 

Pensioners are missing out on millions of pounds worth of state help. Sally West, Age Concern's policy expert, offers some help to those who want to get their hands on the cash.

Many older people look forward to a comfortable retirement. A lack of cash can sometimes make the reality very different.

Pensioner poverty is now at crisis levels and two million pensioners live below the government's poverty line. Many older people find it difficult to cover day-to-day living costs, never mind luxuries.

But the good news is that many pensioners could boost their income by claiming new benefits.

Next month, when the Pension Credit is introduced, half of all pensioners will be entitled to a cash top-up.

It's just the complexity of the different benefits and a lack of awareness which sometimes stops the cash from reaching older people's pockets.

Pensioners are more likely than anyone else to miss out on benefits. Each year hundreds of millions of pounds in benefits cash lies unclaimed.

The main benefits older people should check their entitlement to are:

  • Minimum Income Guarantee (MIG) / Pension Credit

Also known as Income Support and about to be replaced by the Pension Credit, MIG helps with weekly basic living expenses by increasing your income to a minimum level set by the government.

It tops single people up to a minimum of 102.10 and couples to 155.80.The levels can be higher in some circumstances - for example for some disabled people and carers.

You do not need to have paid National Insurance (NI) contributions to qualify but the your income and any savings and capital over a certain level into account are taken into account.

The Pension Credit will go a step further and provide extra cash for people aged 65 and over who have made moderate savings for retirement and currently don't qualify for MIG.

Many older people who now receive MIG will get extra money while others will qualify for the first time. Like MIG it is based on income and savings although there is no specific savings limit.

Currently up to 670,000 eligible older people are not claiming MIG, resulting in up to 820m remaining unclaimed every year.

If you are already getting MIG you will not need to make a claim for the Pension Credit. You will automatically be transferred.

If you do not receive MIG then you will need to claim. You can get a claim form from your local social security office or by calling the Pension Credit Information Line on 0800 99 12 34.

Age Concern factsheet 18 offers information about money benefits including MIG/Pension Credit and factsheet 48 has more facts and figures about the Pension Credit.

  • Council Tax Benefit and Housing Benefit

Many older people find council tax a major drain on their income. Council Tax Benefit, which can reduce your bill, is the benefit pensioners are most likely to miss out on.

It can be claimed by homeowners as well as tenants - the value of your home is not taken into account.

Housing Benefit helps with rent, certain service charges and, in Northern Ireland, with general rates.

These benefits are based on your income and savings and in general you must have no more than 16,000 in savings.

Some of the savings rules will change when Pension Credit is introduced. Other factors such as people in your family, whether you are disabled, and the level of your rent and council tax may affect the amount.

When Pension Credit is introduced, Housing Benefit and Council Tax Benefit rules for older people will become more generous and many, particularly those over the age of 65, will receive extra help, or become entitled for the first time.

Currently up to 1.4m eligible older people miss out on Council Tax Benefit, resulting in up to 580m remaining unclaimed each year The average amount unclaimed is 7.50 a week, or 390 a year.

Up to 270,000 eligible older people are not claiming Housing Benefit, resulting in up to 400m remaining unclaimed each year.

If you apply for MIG/Pension Credit you should be asked if you wish to claim these benefits as well, otherwise contact your local authority. Age Concern's factsheet 17 also gives information about Housing and Council Tax Benefit.

  • Attendance Allowance and Disability Living Allowance

People aged 65 and over who are physically or mentally ill or disabled can get extra cash to help with the extra costs of disability through Attendance Allowance.

It is for people who need help with personal care. If you receive it you choose how you spend it. Attendance Allowance is not related to income or savings and is paid at two different rates: 38.30 if you need help in the day or night and 57.20 if you need help during both.

There is no upper age limit but if you are under 65, you should apply for Disability Living Allowance instead - this can provide extra money for people with care and/or mobility needs.

Age Concern's factsheet 34 gives more information about Attendance Allowance and Disability Living Allowance. To get a claim pack ring 0800 88 22 00.

Further information

Department for Work and Pensions (DWP): you can go to its website (see link on right) to download claim forms for some benefits, obtain leaflets, publications and other information including details of your social security office. The Pension Credit Information Line is 0800 99 12 34.

Age Concern: most areas have a local Age Concern which may provide benefits information. Alternatively you can get free factsheets from Age Concern's Information Line on freephone 0800 00 99 66 or from its website (see link on right). Age Concern also publishes a range of finance-related publications including Your Rights which are available from 0870 44 22 044.

Citizen's Advice Bureaux: these provide advice and information on all kinds of subjects. Find your nearest in the phone book or library.

Local Authority/Council: you will find the address of your local authority in the phone book under the name of your county, unitary authority, metropolitan or London borough, or ask at your local library.


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