Pensioners lose thousands in unclaimed benefits

15 February 2024

Written by Retirement Line Updated: 15th February 2024

A new report has found that UK pensioners are failing to claim thousands of pounds in retirement income that they’re entitled to. 

The 14th annual state benefits insight report by Just Group reveals how nearly eight out of ten (79%) pensioner homeowners eligible for state benefits are failing to claim them. It equates to an average of £1,231 a year lost income per household. 

The report also found that almost one in ten (9%) pensioners were claiming some state benefits, but not receiving their full entitlement, missing out on an additional £476 income per year on average. 

Stephen Lowe, group director at Just Group said: “Every year our research identifies benefits of a very significant value are not being claimed but would make a massive difference to those struggling with soaring living costs.”

The research from Just Group found that the proportion of people who are eligible for benefits but failing to claim them is at its highest in ten years. It reveals that almost four in ten (38%) pensioner households are eligible for one of the key benefits available, yet the majority are either not claiming at all or not claiming their full entitlement. 

Which benefits are UK pensioners missing out on?

The key means-tested benefits for pensioners are Guarantee Pension Credit, Savings Pension Credit, Council Tax Reduction and Universal Credit. 

According to figures from the Just Group survey, 64% of those eligible were failing to claim one of the key pensioner benefits, whilst 13% were missing out on two benefits and 4% on three benefits. 

Guarantee Pension Credit 

Guarantee Pension Credit is the main benefit aimed at helping pensioners getting by on low incomes. According to the report, it was claimed by less than half (47%) of those who were eligible to receive it, with pensioners missing out on £1,671 per year on average.

Not claiming Pension Credit when you are able means you miss out on a host of extra benefits, grants and discounts that come with it. These include free NHS dental care, cold weather payments and a free TV licence for over-75s.

Savings Pension Credit

This is another top-up for pensioners on low incomes but who have moderate savings put away. This benefit had the lowest take-up rate in the survey by Just, with none of those eligible claiming it, missing out on an average £473 income a year. 

Council Tax Support

Also known as Council Tax Reduction, this benefit has the highest number of people eligible for it in the survey, yet only around one in five (19%) of them were claiming it, missing out on an average of £874 each.

Universal Credit

This means-tested benefit is available to people below State Pension Age. The survey found that just one third (33%) of those eligible were claiming for this benefit. It means that potentially thousands of UK households are missing out on an average of £2,428 per year.

Why are so many pensioners not claiming their full benefits?

Up to 2.1 million pensioners are living in poverty, according to the Joseph Rowntree Foundation. So why are so many still failing to claim for the support there are entitled to? There are several reasons why some UK pensioners may not be claiming their full state benefits. 

Lack of awareness is likely to be a significant factor, as many people may not be aware of all the benefits they are entitled to or how to apply for them. 

The complexity of the UK’s welfare system may also be off-putting for some. Navigating through it can be complex, with different benefits available for different circumstances. Pensioners who are less confident about finding all the information online may find it difficult to determine what they are eligible for.

Unfortunately, some pensioners might feel embarrassed to claim benefits, viewing them as handouts rather than their rightful entitlement. This stigma can prevent them from accessing the support they need, even if they are struggling financially.

Work has been done to address these issues and ensure that all eligible pensioners receive their full entitlements. The government and relevant organisations have been working to improve communication and accessibility of information and provide support to help pensioners navigate the system.

How can I check my state benefit eligibility?

There are several checking tools online that will help you to find out if you are missing out on any state benefit support that you could be claiming. Explore the below links to find out more:

Online calculators

• Use the Entitledto benefits calculator for a detailed overview of what you might get. 

• Or, use the Turn2us benefits calculator for a quick idea of what benefits and other financial help you might be eligible for.

• Find out if you qualify for Pension Credit by using the Government's free Pension Credit calculator.

Further reading

• Visit the Government’s Money Helper website for more information on State Benefits in retirement.

• Click here for information on Pension Credit or call the Pension Credit claim line on 0800 99 1234. To make things as simple as possible, they’ll fill in the application form for you. 

• Read about checking your eligibility and claiming for Pension Credit on the Citizens Advice website.

• Contact your local council to find out if you are eligible for Council Tax Reduction.

• Contact Citizens Advice for information on State Benefits, including how to check your eligibility for each of them and how to make a claim.