Pension Credit and Cost of Living Support Grant

Rebecca Long Bailey Excerpts

Wednesday 26th October 2022 Westminster Hall

[Rebecca Long Bailey (Salford and Eccles) (Lab)]

It is a pleasure to serve under your chairmanship today, Mr Dowd. I thank the hon. Member for Glasgow North East (Anne McLaughlin) for securing this important debate. I fully support her call for the Government to extend the eligibility period for the £650 pension credit cost of living grant to the end of the financial year.

Independent Age’s analysis of Government figures shows that around one in six older people in the UK live in poverty. Many are already struggling to afford essentials, and with spiralling energy prices and the general cost of living, that is set only to get much worse. I welcomed the support grant itself, and the plan for an additional £300 pensioner cost of living payment. However, sadly, as hon. Members have heard, Independent Age suggests that more than 850,000 pensioners in the UK do not even receive the pension credit to which they are entitled. That is likely due to a combination of digital exclusion, apprehension about applying and social stigma—and that is before they are even eligible for the extra cost of living payment. We must remember that pension credit is a financial top-up for some of the pensioners who are most in need in this country. In many cases, it means that people do not have to choose between heating their homes and eating. Nobody in the world’s fifth biggest economy should ever face that choice.

A great campaign run by Greater Manchester Housing Providers, Independent Age, Age UK Salford and Citizens Advice Salford has been supporting people to take up their pension age benefits. As of June 2022, it estimated there is over £6.3 million of pension credit unclaimed this year in Salford alone. Independent Age estimated that if everybody who is eligible received pension credit, roughly one in three pensioners in poverty would be lifted out of it. That is the impact these payments have on people’s lives.

The Government must step up to ensure that our pensioners—our grandmothers, grandfathers and elderly friends—receive the support they are entitled to in the first place, as well as the additional crisis support. They certainly should not be excluded due to short, strict deadlines when we know that these exclusion factors are already at play. This is not just about compassion; as we heard from the hon. Member for Glasgow North East, Independent Age estimates that low uptake of pension credit costs the Government £4 billion a year in increased NHS and social care spending. These deadlines are an arbitrary, cruel barrier that the Government are choosing to impose, but they can easily amend them in this time of crisis.

Alongside that, the Government should confirm as a matter of urgency that they will increase income top-ups such as pension credit, not just the state pension, in line with inflation according to the consumer prices index or the higher rate of the pensions triple lock. They should also look urgently at increasing all benefits in line with inflation. According to recent figures from the Resolution Foundation think-tank, the number of all people living in absolute poverty in the UK is projected to rise by 2.9 million between 2021-22 and 2023-24. A real-terms benefit cut would add another 600,000 people to that rise, including 300,000 children.

These are our most economically vulnerable households, and if the magical, mythical unicorn of compassionate conservatism that the Chancellor referred to recently is to be given any meaning at all, the Government can start today by extending the pension credit cost of living grant deadline and uprating benefits and pensions in line with recent inflation figures.