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Pensioners forced into debt by rising cost of living

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26/09/2008

More than half of older people are cutting back on essentials such as heating and food, and one in 10 of the poorest pensioners have been forced into debt by the rising cost of living, according to Age Concern.

With a third of those eligible still missing out on the Government’s flagship benefit Pension Credit five years since its introduction, the charity is calling for urgent government action to increase take-up.

To overcome the deeply ingrained barriers to claiming benefits, Age Concern wants the Government to introduce a new system of automatic payments as soon as possible – an idea supported by seven in 10 older people – and reform the benefits system to help the poorest pensioners cope with their escalating household bills.

The report reveals that six in 10 low income pensioners are only just getting by or are finding it difficult to manage financially. Two-thirds of pensioners are cutting back on the amount of gas and electricity they are using, 52% are buying less or poorer quality food, and 49% are planning on cutting back their heating this winter.

The Government has made some efforts to improve the take-up of Pension Credit and further positive, though limited reforms to the claiming process are about to come into effect. But the charity is warning that these are nowhere near radical enough to significantly increase take-up.

Furthermore, unless take-up dramatically improves, the decision to reduce the period for which older people can claim backdated benefits to fund these reforms will penalise the very poorest.

Gordon Lishman, director general of Age Concern, said: “It is deeply wrong that billions of pounds in benefits cash is failing to reach the poorest pensioners at a time when thousands are feeling forced to cut back on essentials such as food and fuel.

“There can be no doubt that current measures to tackle the scourge of pensioner poverty are falling pitifully short of the mark. Pension Credit has the potential to lift hundreds of thousands of pensioners out of poverty, but will remain more flagging than flagship without urgent action to reform the faltering benefits system. Introducing a system of automatic benefits it is the only effective way to reach all those who need help through these difficult financial times.”

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