Pensioners value state “freebies” over certain benefits according to new research from Just Group. This includes free bus passes, free NHS prescriptions, the Winter Fuel Payments and free TV Licences.
Over 65s in the UK know far more about ‘freebie’ benefits than other Government support measures, according to the latest Just Group State Benefits Index. Free bus passes rank highest for retirees with 99 percent of over 65s aware of the perk, followed by free prescriptions (98 percent), Winter Fuel Payments (98 percent) and free TV Licences (95 percent).
This may prove to be difficult for the Government to manage over the coming years as eligibility changes. Proposed increases to the qualifying age have been negatively received by pensioners.
Currently, NHS prescriptions are free for those aged 60 and over but the Government is consulting on aligning the upper age exemption for prescription charges with the state pension age in England. This would force millions of retirees to only get free prescriptions from the age of 66, or later on in life when the state pension age rises further. Caroline Abrahams, Age UK’s Charity Director, described the move as a “kick in the teeth” for pensioners.
Free bus passes can only be claimed from the state pension age in England. However, the state pension age itself will be rising over the coming years, increasing the wait times for the nationwide pass.
The Government will be increasing the state pension age to 67 between 2026 and 2028. Beyond this, it will rise to 68 by 2046.
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Despite being so well known and prioritised by over 65s, these “freebie” benefits are only worth between £2.08 and £18.03 per week each, Just Group noted. In contrast, one in five (19 percent) did not know about Pension Credit – the main benefit created for pensioners who are struggling on low incomes – even though the benefit is worth more than £59 a week on average and tops up weekly income to £177.10.
Additionally, 10 percent said they did not know about Housing Benefit which provides help with rent payments.
These could be costly oversights for millions of pensioners, with the latest Government statistics showing around a million pensioners who are eligible for Pension Credit are not claiming the benefit while an estimated 200,000 eligible pensioner households are failing to claim Housing Benefit.
Other benefits that could provide valuable financial help to pensioners such as Attendance Allowance and Disability Living Allowance were even less well known among over 65s, despite the higher bands of each benefit being worth £89.60 a week, or £4,659 a year.
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Stephen Lowe, group communications director at Just Group, warned the figures demonstrated pensioners need to ensure they do not miss out on their benefit entitlement when approaching retirement.
“When we reach state pension age our eligibility for a wider range of benefits is likely to increase, so it is important that people check that they are not missing out on their entitlement to extra benefit income,” he said.
“For many people, the idea of checking to see if they are eligible for benefits will not have been a high priority during their working lives, but as people reduce their paid work then the state pension and associated benefits can become increasingly important.”
Mr Lowe highlighted how important benefit awareness is for retirees as state pension reliance could prove to be risky.
“The state pension alone will not provide a comfortable standard of living so checking your entitlement for other state benefits should be as much a part of planning for retirement as understanding what your private pension and other savings will provide,” he said.
“The social and cultural reference to ‘freebie’ benefits means nearly all over 65s know about them but their financial value is dwarfed by other benefits which are less well known.
“Billions of pounds a year of state support aimed at pensioners, particularly those struggling for income, goes unclaimed every year. We’d urge everyone approaching retirement to check whether they are entitled to extra income from state benefits.”
NHS prescription consultation
While the prospect of raising the free NHS prescription age has been condemned by many, the Government said increases used to be the norm.
When the consultation was launched in July 2021, Health Minister James Bethell said: “We are committed to improving patient care and supporting the NHS with the funding it needs to recover from this pandemic.
“The upper age exemption for free prescriptions used to align with the state pension age, but that link has been lost over the years.
“Prescription charges are an important source of income for the NHS, and the costs of providing free prescriptions continue to increase with our aging population.”
The consultation for this increase closed on September 3 and a response is expected over the coming months.
While “freebie” changes may be on their way, it should be remembered Pension Credit is still an underutilised benefit. Pension Credit will provide eligible claimants with extra money to help with their living costs if they’re over state pension age and on a low income.
This can include support with housing costs such as ground rent or service charges. To be eligible for Pension Credit, claimants must be living in England, Scotland or Wales when they apply. They must have income levels below a certain threshold and this includes income split among partners.
Pension Credit will top up weekly income to £177.10 for those who are single. Weekly joint income will also be topped up to £270.30 for those in partnerships.
Extra payments may also be awarded to those who have severe disabilities, care for adults or children or have certain housing costs.
Claims for Pension Credit can be started up to four months ahead of reaching state pension age and applications are made online, over the phone or through the post.