Elderly must repay £130m in pension credit fiasco - Telegraph

Elderly must repay £130m in pension credit fiasco Mervyn Kohler: 'This strikes me as mean'   By Toby Helm and Stephanie Condron

12:01AM GMT 10 Mar 2006

Tens of thousands of elderly people who receive money through pension credits face having to pay part of it back to the Treasury because of overpayment blunders, the Tories claimed last night.

The Department for Work and Pensions admitted that it would attempt to claw back cash from some of the country's poorest pensioners after official figures showed overpayments had more than tripled from £40 million in 2001/2 to £130 million last year.

David Ruffley, the Conservative spokesman on welfare reform, accused ministers of gross mismanagement and predicted a repeat of last year's fiasco over tax credits, which saw the Government attempt to reclaim part of a total £2 billion overpayment.

"Pensioners face the prospect of being rung up by the Department for Work and Pensions asking for its money back," he said.

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Help the Aged described the move as "heartless".

A spokesman said that many pensioners would now be so worried they had been overpaid that they would cut back on essentials including heating.

"Twenty per cent of pensioners are living below the poverty line," said Mervyn Kohler, Help the Aged's spokesman. "To go chasing some of those individuals strikes me as mean.

"One of the problems with the pension credit is that the calculation of what you are entitled to is so complex that for an ordinary member of the public to know what they are being paid is right or not is impossible."

Elizabeth Blackman, a representative for the National Pensioners Convention in the East Midlands, said: "Can they explain how it would be obvious to the average pensioner that they had been overpaid?

"The problem with pension credit is pensioners are not claiming it because it's too complex so how the heck are they to realise when they've been overpaid?

"The Government has been sending out reminders to people that they may be eligible to claim but this will put people off claiming."

A spokesman for the Department for Work and Pensions insisted that no pensioner who had received overpayments as a result of a Government error would be required to pay money back - unless the mistakes had been "very obvious".

"If, for instance, someone had received two payments in the same week then there would be a case for repaying it," said the spokesman.

"But this would be done sensitively. If it would cause hardship there would be no requirement to pay back the entire lump sum immediately."

Pension credit, which is received by 3.3 million people, is a lynchpin of Gordon Brown's strategy for lifting pensioners out of poverty. The intention is to provide older people with a minimum level of income.

But there have been many teething problems since it was introduced in 2003.

The figures published by the Work and Pensions department show that there was overpayment in 2004/05 amounting to 2.1 per cent of total pension credit payments.

Vince Cable, the Liberal Democrat Treasury spokesman, said that it was "outrageous" that people who had struggled with bureaucracy and endless complex forms to extract their pension credit were now being hunted down by the Government and were being asked to repay the money.

James Plaskitt, the minister for benefits, said that despite the problems, Pension Credit was helping many pensioners out of poverty.

The systems for delivering the correct sums to the right pensioners were also improving.

"Pension credit continues to deliver more money to the poorest pensioners with over three million getting more money as a direct result."

Last year Tony Blair apologised for the "hardship and distress" suffered by poor families as a result of mis-management of the separate tax credit system run by the Treasury.

In addition to £2 billion of overpayments some 713,000 people were found to have been underpaid £500 million. The problems were blamed in large part on malfunctioning IT systems.

UK News News » External Links Pensions & Retirement step 1 - Department for Work and Pensions (DWP) Help the Aged National Pensioners Convention

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pensacola beach hotels with lazy river Are you missing out on pension credit cash? Some 1.43m people fail to claim £3bn-plus a year - but it only takes one free call to find out if you qualify By Tanya Jefferies for Thisismoney.co.uk

Published: 12:17 EDT, 7 July 2015 | Updated: 12:17 EDT, 7 July 2015

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Cash-strapped elderly people are losing out on a whopping £3.26billion of pension credit cash a year.

Some 1.43million people - nearly two out of five who qualify - fail to claim the benefit, which tops up your weekly income to £151.20 if you are single or to £230.85 if you are in a couple.

Reasons for missing out on pension credit can include being too proud to claim, not realising you qualify, thinking it's not worth it for a couple more pounds a week, and being put off by the thought of filling in forms.

Too proud? Pensions Minister Ros Altmann tells older people to claim what is rightfully theirs

According to the latest data from the Department for Work and Pensions, around 2.26million pensioners did claim pension credit in the 2013-2014 tax year.

Pensions Minister Ros Altmann says people shouldn't be too proud to get what is rightfully theirs, and is urging younger people to speak to parents and grandparents and encourage them to find out if they qualify for pension credit.

RELATED ARTICLES Previous 1 Next Revealed: What YOUR pension provider will charge you to... Want a cheap and easy income drawdown plan? State-backed... Share this article Share Altmann said: 'Older people who have worked hard all their lives, and contributed to our society and economy over many decades, deserve to be looked after in their retirement. We want pensioners who meet the criteria for pension credit claim that money to help them live more comfortable lives.

'Some older people don’t claim their pension credit because they feel too proud to rely on benefits – and I think this is where younger relatives can make a huge difference by talking to their parents or grandparents and explaining that this support is rightfully theirs.

'We have tried to make signing up for Pension Credit as simple as possible – just one free phone call to 0800 991234 can be all it takes to find out if you are eligible.'

Labour MP Frank Field said: 'We need immediate action to get the necessary help to poor pensioners who are entitled to Pension Credit but aren’t claiming it.

'Might the Government now make a renewed effort to help sign people up to the vital help they’re entitled to, and thereby begin reducing the numbers of poor pensioners who can’t afford to feed themselves or heat their homes?’

WHAT IS PENSION CREDIT AND HOW DOES IT WORK?  Pensioners can use this benefit to top up their income if what they are currently getting is below a certain level per week.

Pension credit  comes in two parts:

* Guarantee credit tops up your weekly income to £151.20 if you are single or to £230.85 if you are in a couple. The weekly income level might be higher if you're a carer, severely disabled or have certain housing costs.

* Savings credit is an extra payment for those who saved some money towards their retirement, such as in a pension. Pensioners can be entitled to savings credit as well as or instead of the guarantee credit. But the savings credit is being phased out from April 2016. The amount you can have in savings and still qualify - known as the 'capital disregard' - is £10,000.

The pension credit qualifying age is linked to the state pension age for women, which is currently rising in gradual stages to bring it line with men's state pension age of 65.

As of 6 July 2015 women’s state pension age is between 62.7 and 62.8 years, and it will start exactly matching men's in November 2018. However, you must be aged 65 or over to get the saving credit as well.

You don’t have to pay tax on pension credit.

To get the benefit, make a free phone call to 0800 991234 to find out if you are eligible and how to sign up.

The Government has more here , and you can find a pension credit calculator here .

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Pension Credit Pension Credit is a benefit for people on a low income. It can be used to top up any State Pension that you’re getting. 

On this page:

About Pension Credit

Who is Pension Credit for?

How much Pension Credit could you get?

How to claim Pension Credit

If you qualify

If your claim is rejected

Other benefits you could get

About Pension Credit

Pension Credit is a means-tested benefit. Means-tested benefits are the ones that vary depending on how much income you have.

There are two parts to the benefit:

Guarantee Credit – this tops up a low income. Savings Credit – this is intended to provide extra money if you have modest savings and are aged 65 or over. Who is Pension Credit for?

Pension Credit is for people on a low income who have reached Pension Credit age. This is going up from 62 to 65 years to bring it into line with the State Pension age for a man (which is 65) by 2018. From then on both Pension Credit age and State Pension age for both men and women will rise together. You can visit the  Gov.uk website calculator  to work out your Pension Credit age.

If you're in a relationship

Only one member of a couple can claim this benefit. You’re considered to be part of a couple if you’re married, in a civil partnership, or cohabiting (living with someone as part of a couple).

If you’re the person who’s claiming, it doesn’t normally matter if your partner hasn’t reached Pension Credit age. However, if you’re living in an area where Universal Credit has been introduced it does matter. You’ll only be able to claim Pension Credit when both of you have reached the right age.

How much Pension Credit could you get?

This will depend on your circumstances.

Guarantee Credit

This is worked out by comparing the amount the law says you need to live on with your income. As with other means-tested benefits, some of your income is taken into account while other parts of your income may not be. While these rules are complex, the main thing to know is that Guarantee Credit tops up a low income to the amount the law says you need to live on. This amount is higher if, for example, you or your partner has a severe disability or is a carer.

Savings Credit

Savings credit is currently being phased out and isn’t available to people reaching State Pension age on or after 6 April 2016. If you reached State Pension age before 6 April 2016, you can still get Savings Credit if you meet the qualifying conditions. 

If you’re part of a couple where one person has reached State Pension age before 6 April 2016 but the other person reaches State Pension age on or after 6 April 2016, you can only get Savings Credit if one of you qualified or received Savings Credit before 6 April 2016.  

For more information about your entitlement, visit the GOV.uk website   or get advice from a benefits adviser .

How to claim Pension Credit

The best way to claim is by phone. In England, Scotland and Wales, phone the Pension Credit claim line on 0800 99 1234 or visit the GOV.uk website . An adviser from the Pension Service  or an advice centre can help you fill in the form, either at the centre or by visiting you at home.

In Northern Ireland, phone the Pension Centre on 0808 100 6165 or visit the nidirect website . Your claim can be backdated for up to three months if you met the qualifying conditions throughout that period.

If you qualify

If you qualify for Pension Credit, it’s usually paid into your bank or building society account in arrears.

Telling the DWP or SSA about a change in circumstances

The rules for most benefits require that you tell the Department for Work and Pensions (DWP) or Social Security Agency (SSA) in Northern Ireland of any relevant change of circumstances.

However, before 6 April 2016, Pension Credit was unusual in that the DWP or SSA often set an ‘assessed income period’, which was usually five years. During this time you didn’t have to tell the Pension Service of any changes in your retirement plans, which included things like getting an occupational pension.

However, from 6 April 2016, ‘assessed income periods’ were abolished for new claims. This means anyone claiming Pension Credit from 6 April 2016 needs to tell the DWP or SSA about any change in their circumstances.

If you were already getting Pension Credit before that date, your ‘assessed income period’ should continue as normal for the time being, unless it ends for some other reason (for example, you marry or get a new partner, you stop being treated as a couple, or you or your partner reach the age of 65).

If your claim is rejected

The rules for decisions on your Pension Credit claim and for asking for reconsiderations and appeals are the same as for other DWP or SSA benefits. Read our information  about appealing a benefits decision for more details.

Other benefits you could get

If you’re awarded the Guarantee Credit part of Pension Credit, you may be entitled to:

full help with your rent ( Housing Benefit ) help with mortgage interest payments and certain other housing costs help from your local council towards your Council Tax (or rate relief in Northern Ireland) help with NHS charges  such as vouchers for glasses and hospital travel fares

If you’re entitled to either part of Pension Credit you may also be able to get a Funeral Payment from the Social Fund to help with funeral expenses if a partner, child, close relative or close friend has died.

Useful links Citizens Advice   Disability Rights UK   (Pension Credit) GOV.uk   (Pension Credit calculator) nidirect   (Pension Credit) Published date: 17 May 2016

Review date: 17 May 2017

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