Pensioners Express Concerns Over Potential Welfare Cuts
Pensioners who are already struggling to make ends meet on their state pensions have voiced their anxieties regarding impending welfare cuts. They fear that these reductions will disproportionately affect older individuals, who may find it increasingly difficult to manage their finances with any further decreases in income. The UK government’s benefits overhaul is anticipated to be more severe than initially communicated by Chancellor Rachel Reeves, who is striving to address a significant gap in the nation’s public finances.
As reported by The i Paper, Chancellor Reeves has opted against implementing substantial tax increases during the upcoming Spring Statement, even if the budget watchdog indicates she is on track to violate her self-imposed borrowing limits. Instead, Reeves is exploring a series of policies aimed at slashing welfare expenditures ahead of an updated economic and public finance forecast, which is set to be released on March 26. The government had already been planning to trim the benefits budget by at least £3 billion, but it is now expected that the cuts will be more extensive.
In an effort to address the fiscal deficit, the government altered the eligibility criteria for the winter fuel payment, resulting in nearly nine million pensioners missing out on this crucial benefit. Two pensioners, currently tightening their budgets, shared with The i Paper how they are already living on the edge and cannot bear any further reductions to their already limited income.
Sue Johnson, a 75-year-old resident of Chelmsford, Essex, meticulously tracks her expenses to ensure she can cover only the essentials. The retired librarian, who has been married to her Swedish husband, Bertil Nilsson, for 16 years, splits her time between the UK and Sweden. She receives a reduced state pension due to having left the workforce at 60 and taking time off to care for her children.
“Bertil spends part of the time in Sweden and receives his pension in Swedish krona, while I get mine in pounds, which complicates our finances,” she explained. “When I am in Sweden, he covers all expenses since his pension is significantly larger than mine. Living costs have escalated in both countries, and while I used to support him when we were in England, I can no longer afford to do so.”
Ms. Johnson has calculated her monthly income totals £1,532. After paying for council tax, utilities, internet, food, and car expenses, she finds little remaining. “With prices soaring, even with careful budgeting, there is hardly anything left at the end of the month,” she lamented. “We rarely dine out and don’t indulge in takeaways; we stick to the basics and avoid luxuries. Losing the winter fuel payment due to being slightly over the threshold for pension credit has made things even tougher.”
As a lifelong Labour supporter, Ms. Johnson is disheartened by the party’s current stance. “Why is Labour targeting those of us on state pensions or disability benefits instead of the wealthier individuals who could afford to pay more?” she questioned. “It’s disheartening to see the government penalizing the most vulnerable while letting the affluent off the hook.”
Simon Moss, a 70-year-old resident of Sunderland, echoed her sentiments, expressing his struggles to survive on the state pension. He often faces the impossible choice between heating his home and buying food. “Life is a constant struggle; my finances simply don’t stretch far enough,” he stated. “At the moment, I have no coffee or milk and won’t be able to buy any until my pension arrives next week.”
The widower, who lives alone in a small bungalow, has a modest private pension that barely exceeds the threshold for pension credit. He fears that any further cuts will jeopardize his already precarious financial situation. “My heating bill alone is £90 a month, and I only turn it on when absolutely necessary. My supplier now wants to increase my direct debit to £120 monthly to cope with rising costs, and I no longer qualify for the winter fuel payment.”
“I can’t afford to do a monthly grocery shop anymore; I only purchase essentials as needed. I’ve cut back on everything, including my social life, to make ends meet,” he added.
Pension Credit Explained
Pension Credit is a financial support system designed to assist individuals over the State Pension age who are on a low income. It provides additional funds to help with living costs and can also cover housing expenses such as ground rent or service charges. Additional support may be available for those who are caregivers, severely disabled, or responsible for a child or young adult.
If you qualify for Pension Credit, you may also receive:
- Housing Benefit if you are renting your home
- Winter Fuel Payment
- Support for Mortgage Interest if you own your home
- A discount on Council Tax
- A free TV licence if you are 75 or older
- Assistance for NHS dental treatment, glasses, and transportation costs for hospital visits if you receive a specific type of Pension Credit
- Help with heating expenses through the Warm Home Discount Scheme
- A discount on the Royal Mail redirection service when moving home
Mr. Moss fears that the government may target pensioners once again. “If any further cuts are made to benefits for pensioners, my struggle will become even more unbearable,” he remarked. “Why does the government always choose to cut support for the most vulnerable, those who can least afford it? It’s both shocking and immoral.”
Stewart McCulloch, the chief executive of Christians Against Poverty (CAP), expressed deep concern over the potential welfare cuts. “While the specifics remain unclear, we are apprehensive about any reductions to the income of those already in dire need,” he stated. “Individuals on low incomes are often hit hardest by rising costs, as their tight budgets leave no room for absorbing price hikes.”
“We anticipate further increases in energy, water, and council tax bills, coupled with rising inflation, which will add to the pressure on those already living in poverty and unmanageable debt. Millions across the UK struggle to cover basic needs, with our local debt coaches visiting individuals and families who often feel isolated, living in cold homes with empty fridges due to various challenges leading to their financial distress.”
CAP advocates for a protected minimum level of social security—an Essentials Guarantee—to ensure that the basic rate of social support always covers essential living costs, preventing benefits from falling below an unacceptable level. They also urge employers to provide wages sufficient to prevent employees from living paycheck to paycheck.
Chancellor Reeves decided to eliminate universal winter fuel payments shortly after Labour’s election win last July, as the government sought to close a reported £22 billion gap in public finances. The government has restricted energy bill support, which ranges from £200 to £300 per household, only to those receiving means-tested benefits, including pension credit.
As of December 23, the backlog of pension credit claims surged to 92,400, according to pensions minister Torsten Bell. Although progress has been made in reducing this caseload, approximately 74,000 claims remained unresolved as of January 13, according to Bell. The Treasury estimates that means-tested winter fuel payments would save around £1.4 billion annually, with Labour leader Keir Starmer stating in November that the cut “makes sense” as many previous claimants were “relatively wealthy.”
A spokesperson for the Department for Work and Pensions (DWP) commented, “We are committed to supporting pensioners, with millions expected to see their state pension increase by up to £1,900 during this parliament due to our Triple Lock pledge. Our efforts to boost Pension Credit uptake have already led to 50,000 new claims compared to last year. We recognize that the current welfare system requires reform to better assist the long-term sick and disabled in finding employment, while also ensuring fairness for taxpayers.”
