Older lady wears many layers while inside to stay warm (Image: Getty Images/iStockphoto)
One in six pensioners is living in poverty, a think tank has said. Some 16% of all pensioners, or 1.9 million, are in poverty.
Sasjkia Otto, of the Fabian Society think tank which did the research, said: “It’s a common misconception that all pensioners are well off but this masks significant inequality. Neither the state pension nor benefits guarantee protection from poverty and many are falling through the cracks, especially those who are renting. This situation could deteriorate, as the number of pensioners living in this sector increases.
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“Our social contract requires dignity in retirement, and for future generations to have a living standard at least as good as their predecessors. This is now at risk. But there is also a fiscal case to address pensioner poverty, as it costs the UK billions in health and social care each year.”
Chancellor Rachel Reeves axed the winter fuel payment, an up to ￡300 lifeline, for 10 million pensioners ahead of winter.
The Daily Express has insisted ministers U-turn on the decision and restore the payment.
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That comes as nearly 100,000 pensioners are on a debt repayment plan with the Department for Work and Pensions (DWP), the Fabian Society said.
It warned that this meant disability benefits could be reduced by up to a third during the repayment period.
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Means-tested benefit deductions for pensioners not living in care homes could be between ￡663 and ￡1,768 each year depending on the circumstances.
The state pension is too low to prevent poverty for everyone, the report called Mature Decisions: Options for alleviating pensioner poverty found.
Poverty is higher among those who retired before April 2016, on the ‘Basic State Pension’, because the old rules made it more difficult to qualify for the full amount.
Older woman turns down heating to save money on bills (Image: Getty Images)
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This is particularly true for women. But some receiving the New State Pension also slip through the cracks because of housing costs and National Insurance contribution gaps.
Ms Otto said: “Social security reforms under the last Labour government helped halve pensioner poverty.
“Now, it is time for Labour to finish what they started. The 1942 Beveridge report established the principle that the state pension should be set in a way that protects people from poverty.
“The government should use the upcoming pensions review to consider the purpose of the state pension in the 21st century.”
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A DWP spokesman said: “This Government’s support for pensioners is steadfast.”
“Through our commitment to protect the Triple Lock, millions will see their State Pension rise by up to ￡1,900 over this parliament. Alongside this, we extended the Household Support Fund to help with the cost of food, heating and bills.
“Our campaign to boost Pension Credit take up has seen applications double and we urge anyone who thinks they are eligible for Pension Credit to check now as it’s worth ￡4,200 a year and opens the door to further benefits.”