During a time of unprecedented cut-backs and high unemployment, it is rare to hear of any cash going spare. So many people will be surprised and puzzled to discover that up to £5.4billion of pensioner benefits is sitting in Government coffers going unclaimed each year, while 1.8 million pensioners are living below the poverty line. Something is clearly going wrong.
Raising awareness about the importance of claiming pensioner benefits is a perennial problem – but our research shows right now it’s more important than ever that older people get the financial help they need.
This week’s inflation figures clearly showed the problem for many pensioners – a growing gap between living costs and fixed incomes. Despite inflation falling slightly, the Retail Price Index is still at 5.3% with food and fuel rising rapidly, yet pensioners will only see the basic state pension increase by 4.5% this year and other benefits by just 3.1%.
In fact even the standard Retail Price Index can understate older people’s living costs with Age UK’s Enterprises Silver RPI showing that, since 2008, inflation has been higher for older people than for those under the age of 55
What more, new polling data released by Age UK today shows nearly half of over 60s say they are struggling with these rising living costs and more than one in ten saying are finding things really difficult. One in five pensioners had cut back on their heating over the winter months in order to make ends meet. Among poorer pensioners, one in five say they are going out less in order to save money, and over a third are buying cheaper or less food.
We know these are difficult times for many older people – so in the face of such adversity, why aren’t people claiming the benefits intended to help them? The reasons are complex and varied.
1) It’s very difficult to work out what you are entitled to and many people are put off from claiming because the system is so hard to navigate. Many people are unaware of the range of benefits available or don’t realise they are eligible because they own their own home or have savings.
2) There also remains a stigma attached to claiming benefits still wrongly seen by some as ‘handouts’.
Ultimately the best way to ensure that people receive the benefits they are entitled to is for them to be paid automatically or better still, to have a basic state pension set at a level where people don’t need to reply on means tested benefits.
This is why Age UK welcomes the Government’s recent proposals to introduce a flat rate pension of around £140 a week to all pensioners, which will help people feel much clearer about the amount they will receive in retirement. But these proposals will not help those who have already retired as the government has made it clear that the flat rate pension is for those retiring after a future date yet to be decided.
In the meantime, the evidence shows that clear, independent information and advice and face-to-face communication are key to improving the take-up of benefits. To help people access this sort of advice, Age UK is launching the charity’s More money in your pocket today which is part of the Let’s Talk Money Campaign, aimed at getting an extra £120 million into the pockets of 500,000 older people over the next year.
To find out more go to www.ageuk.org.uk/letstalkmoney or get in touch with your local Age UK or Age Concern, or call Age UK Advice, the charity’s free helpline 0800 169 65 65