Poorer pensioners receiving less state support than wealthier counterparts

The UK’s poorest single pensioners are receiving up to £4,000 less in state benefit income each year than those better off than them.

Just Group has analysed three years’ pensioner income data from the Department for Work and Pensions, which shows that the bottom income quintile of single pensioners receive £8,840 a year on average.

Around £7,644 of this is from state benefits, while £1,248 comes from elsewhere.

The fourth quintile has £12,116 to spend, of which £10,660 is provided by the state.

The third quintile gets the same amount from the state, boosting its average income to £14,196 and the second quintile receives £11,700 in government benefits, taking its income to £18,460.

The richest retired quintile is paid £10,244 in state benefits and has an overall income of £34,268.

The figures show that the second richest pensioner quintile get 53 per cent more each year in the form of state support than those with the smallest incomes, while the top quintile receives around £2,500 more than the poorest pensioners, despite their annual income being £25,000 higher on average.

A similar picture exists for pensioner couples. The poorest obtain £12,168 a year in benefits, £500 a year less than the richest quintile, and £2,652 less than retired couples in the middle quintile.

Benefits account for nearly 90p in every pound of income received by the poorest fifth of retirees.

Just Group group communications director, Stephen Lowe, has said that the figures demonstrate how reliant the poorest pensioners are on the state pension.

“The state pension forms the bedrock of retirement finances for the majority of pensioners and these figures reveal just how much the poorest rely on it, as well as other benefits, ranging from Pension Credit to the winter fuel allowance,” he said.

“Millions of pensioners are dependent on this state support but still their income falls some way short of the Joseph Rowntree’s Minimum Income Standard of £10,452 a year for a single pensioner,” he continued.

“State Pension Shortfall Day was reached 42 days ago, the point in the year when the full State Pension entitlement would only support living costs for the average single pensioner until the end of August.

"Beyond this point in the year, retirees on an average rate of expenditure would need to fund the final four months of the year through their own purse or additional support from the state.”

Lowe also said that any pensioners who are homeowners could boost their income by claiming their full benefits entitlement, but are not doing so.

He said that when delivering advice, Just Group has noticed that half of all retired homeowners are not claiming any benefits beyond the state pension, while a further fifth are not claiming their full entitlement.

“Many assume that because they own their property they are not entitled to extra support, but we would encourage all retirees to check whether they are eligible to additional income which could be worth thousands of pounds each year,” he added.

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