Tag: means-tested benefits

Pension Age Winter Heating Payments

Proposals to support pensioners in Scotland this winter

All pensioners in Scotland with an income of less than £35,000 will receive Pension Age Winter Heating Payments this winter of either £203.40 or £305.10 per household, Social Justice Secretary Shirley-Anne Somerville has confirmed.

This means pensioners in Scotland will be better off compared to those in the rest of the UK.  

Pensioner households with no-one aged 80 or over will receive £203.40, rising to £305.10 for households with someone aged 80 or over.

Following the UK Government’s recent change to winter fuel payments, the Scottish Government will withdraw the current amendment regulations before the Scottish Parliament, which were previously lodged in order to protect pensioners in Scotland against the UK Government’s planned cuts to winter fuel payments.

The move will now see over 720,000 Scottish pensioners benefit.

Ms Somerville said: “The UK Government’s decision to cut the Winter Fuel Payment last winter was a betrayal of millions of pensioners, and their recent U-turn is welcome if belated.

“Following careful consideration of the options available, the Scottish Government will mirror the approach taken by the UK Government.  We will bring forward regulations to ensure that, from this winter onwards, all pensioners will receive either £203.40 or £305.10 per household, depending on age.

“We are in discussion with the UK Government to extend the proposed arrangements in England and Wales to recover payments from those pensioners with an individual income of more than £35,000 through the tax system.

“The intention is that the payment will be recovered automatically, and pensioners will not need to register with HMRC for this or take any further action.

“This approach ensures a higher level of support which those most in need will receive. Over 720,000 Scottish pensioners are estimated to benefit from the higher payment.”

Leading pensioner poverty charity welcomes decision on Pension Age Winter Heating Payment

Debbie Horne, Scotland Policy and Public Affairs Manager at Independent Age, said: “We welcome today’s confirmation from the Scottish Government that all older people with an income of less than £35,000 a year will receive the higher rate of Pension Age Winter Heating Payment.

“This decision will provide some comfort to the hundreds of thousands of older people in Scotland who live in fuel poverty. 

“In a compassionate and wealthy society, no one should struggle to stay warm in the winter due to cost. The commitment by the Scottish Government to uprate the PAWHP annually is also welcome and key to ensuring the payment does not lose its value due to inflation. 

“This means the payment will now be worth £203.40 or £305.10 per household, depending on age, with the payment recovered through tax from those with an income over £35,000.  

“We welcome this decision and hope the Scottish Government continues to take steps to reduce financial hardship, including the creation of a strategy to tackle pensioner poverty.”

U-Turn: Nine million pensioners to receive Winter Fuel Payments

  • Everyone over the State Pension age in England and Wales with an income of, or below, £35,000 a year will benefit from a Winter Fuel Payment this winter.
  • This increased threshold means no lower or middle-income pensioners will miss out, with the vast majority – over three quarters – of pensioners in England and Wales receiving the payment.
  • Support will continue to be targeted, with pensioners above this threshold having the payment automatically recovered or able to opt out.

Nine million pensioners to receive Winter Fuel Payments this winter as all pensioners in England and Wales with an income of, or below, £35,000 a year will benefit from a Winter Fuel Payment. 

This extends eligibility to the vast majority of pensioners, with around 9 million, or over three quarters, benefitting. This threshold is well above the income level of pensioners in poverty and is broadly in line with average earnings, balancing support for lower income pensioners with fairness to the taxpayer

This change will cost around £1.25 billion in England and Wales and see means-testing of the Winter Fuel Payment save around £450 million, subject to certification by the Office for Budget Responsibility compared to the system of universal Winter Fuel Payments.

The costs will be accounted for at the Budget and incorporated into the next OBR forecast. The Chancellor will take decisions on funding in the round at that forecast to ensure the government’s non-negotiable fiscal rules are met. This will not lead to permanent additional borrowing.

No pensioner will need to take any action as they will automatically receive the payment this winter, and for those with incomes above the threshold it will be automatically recovered via HMRC.

The payment of £200 per household, or £300 per household where there is someone over 80, will be made automatically this winter. Over 12 million pensioners across the United Kingdom will also benefit from the Triple Lock, with their State Pension set to increase by up to £1,900 this parliament. 

Chancellor of the Exchequer Rachel Reeves said: “Targeting Winter Fuel Payments was a tough decision, but the right decision because of the inheritance we had been left by the previous government. It is also right that we continue to means-test this payment so that it is targeted and fair, rather than restoring eligibility to everyone including the wealthiest. 

“But we have now acted to expand the eligibility of the Winter Fuel Payment so no pensioner on a lower income will miss out. This will mean over three quarters of pensioners receiving the payment in England and Wales later this winter.”

Pensioners above the £35,000 threshold will have the full amount of the Winter Fuel Payment they received automatically collected via PAYE, or via their Self-Assessment return.

No one will need to register with HMRC for this or take any further action.  Pensioners who want to opt out and not receive the payment at all, will be able to do so, with details to be confirmed.

Making these changes now gives people certainty and ensures that payments can be made in time for this winter. Payments will be better targeted than before 2024-25 when they were previously paid to all pensioners regardless of their income, meaning those on lower and middle incomes will still receive the help they need, ensuring fairness for both pensioners and taxpayers.

Approximately 2 million individuals in England and Wales over State Pension age have taxable incomes above £35,000.