Guest Comment: The impact of Pension Credit changes on mixed-income couples

On 15 May, the rules governing how some people qualify for Pension Credit changed.
Before this date, people in couples, where one person is above state pension age (SPA) and the other person below, would both qualify for Pension Credit when the older person reached SPA.

Now, they must wait until the younger person does. The government believes that 60,000 couples will be affected within five years, generating annual savings of £385m.

For mixed-age couples on a low income, this policy change could have serious effects.
The expectation is that they would claim Universal Credit instead of Pension Credit – a benefit designed with the sole aim of encouraging working-age people to find and increase paid work.

As a result, mixed-age couples receiving Universal Credit are very likely to be worse off than those on Pension Credit, seeing their pension savings providing less value, and resulting in increased pensioner poverty.

The basic rates of income from Pension Credit and Universal Credit for couples are very different. Under Pension Credit, a couple would receive a minimum guarantee of £255.20 per week, compared to £115.13 under Universal Credit.

Furthermore, Pension Credit provides access to other sources of social security income that Universal Credit does not. As a result, the Pensions Policy Institute estimates that in some specific circumstances, couples could be more than £10,000 per year worse off.

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