Citizens Advice Scotland has been advocating for a social tariff, which discounts energy bills for those on the lowest incomes
The UK Government recently announced stark changes to winter energy support that means many hundreds of thousands of pensioners will have less money to pay for fuel costs.
This was followed by Ofgem’s quarterly price cap announcement that an average household’s energy bills will be £1,717 a year, an increase of 10% this winter.
Pensioners will have higher energy bills this winter but less money to pay them. Many will be pushed into fuel poverty.
A complex combination of factors combined with the removal of a crucial benefit will cause financial hardship for many people. There is a very real risk that older people who are just managing will now experience fuel poverty.
Fuel poverty rates for pensioner households in Scotland are already significantly higher than for younger households. Remote rural parts of Scotland have a higher proportion of pension age people. And housing stock in remote rural areas can be less energy efficient and that older people can need to heat their homes more.
As of this year, Winter Fuel Payment, which is paid at a rate of either £100 or £300 depending on someone’s circumstances, will only be paid to pensioners who are in receipt of Pension Credit or other means-tested low-income benefits.
Pension Credit is paid to pensioners on a low income and is worth a maximum of £3,900 extra a year. If you have an income of less than £218.15 a week as a single pensioner or £332.95 as a couple you could be eligible for Pension Credit.
Pension Credit doesn't only result in entitlement to Winter Fuel Payment, it also means people can get a Warm Home Discount, worth £150, and the Winter Heating Payment, worth £58.65.
It's likely that the tightening of the eligibility criteria will affect around 900,000 pensioners in Scotland, who face the cliff edge of the eligibility of such an important benefit.
We know that a sizeable number of pensioners who could be eligible for Pension Credit don't claim it. The Department for Work and Pensions estimates this to be 880,000 people UK wide. Often people don’t claim benefits they are entitled to because they aren’t aware of them or claiming is too complicated, but people can also feel stigma around claiming benefits.
Our advisers are already seeing people concerned they may struggle due to the removal of Winter Fuel Payment. Just this month an adviser told us of Helen who receives only a state pension and a small occupational pension and is only £3 above the Pension Credit limit. These are the people who will struggle – the group with an income too high for Pension Credit, but only just.
A more nuanced approach is needed. We cannot ignore there is a very real need for heating support for older people far beyond the now hugely limited Winter Fuel Payment. Citizens Advice Scotland has been advocating for a social tariff, which discounts energy bills for those on the lowest incomes, or for people with unavoidably high energy use, such as disabled people. Securing this will take time so in the meantime, for people on low incomes, checking entitlement to Pension Credit will be the most important action to take.
Our message to you now? Talk to your relatives, your friends and neighbours. If you think this might be you? Get advice, get a benefit check, claim your entitlement. Don't lose out.
Stephanie Millar is manager of Citizens Advice Scotland's Social Justice team.
This column was first published in the Herald.
