Pension credit take-up

#21 —

Welsh Affairs Committee

Recommendation: The DWP and Welsh Government should work together with local authorities to run a take-up campaign on Pension Credit, with messaging designed to both raise awareness but also address any reservations some older people may have about claiming it.

Gov response: The Department for Work and Pensions is undertaking a range of actions to raise awareness of Pension Credit and encourage eligible pensioners to claim, as part of a new national communications campaign, launched on 4 …

Accepted

#21 —

Work and Pensions Committee

Recommendation: The line between advice and guidance is a continuing issue of debate. There is demand for both enhanced guidance and limited advice, but there is reluctance from the industry to operate too close to the advice/guidance boundary and resistance to …

Gov response: Individuals wishing to use dashboards will be able to delegate access to MaPS guiders or authorised financial advisers who have the relevant permissions under the Financial Services and Markets Act 2000 to advise on investments …

Under Consideration

#20 —

Work and Pensions Committee

Recommendation: The Pension Advice Allowance allows £500 to be withdrawn from a pension up to three times in different tax years for advice. Either because of a lack of awareness or lack of demand the policy is not working. Its design …

Gov response: The growth in the number of deferred small pots in the automatic enrolment (AE) market and the impact on the consumer is an issue the government is determined to address. Our aim is to make …

Under Consideration

#19 —

Work and Pensions Committee

Recommendation: Advice is a personalised recommendation that can only be provided by a regulated firm at a cost. Few people seem to be willing to pay for financial advice for the decisions they make about their pension savings—even though doing so …

Gov response: It is important to establish trust in dashboards as they are introduced, and until they are, that transactions should not be enabled. We have taken the position that they will start with a basic level …

Under Consideration

#17 —

Work and Pensions Committee

Recommendation: The “stronger nudges” towards guidance being proposed by the Department for Work and Pensions and the Financial Conduct Authority will not be enough to make receiving pensions guidance the norm. The Money and Pensions Service told us that it would …

Gov response: TPR and the FCA promote the tools available from MoneyHelper in their employer and trustee guide on providing support to members on financial matters. They will continue to work with partners to explore ways to …

Under Consideration

#16 —

Work and Pensions Committee

Recommendation: Pension Wise is a well-regarded but under-utilised service. The pension freedoms will be seen as a failure if savers make poor decisions without receiving the guidance they were promised when the freedoms were introduced. The Minister for Pensions and Financial …

Gov response: The Money and Pensions Service provides tailored guidance to individuals, based upon the information they provide. For instance, MoneyHelper Pensions (previously known as The Pensions Advisory Service), already provide specialist pensions and divorce appointments and …

Under Consideration

#20 —

Welsh Affairs Committee

Recommendation: We received evidence regarding a lack of awareness among the wider public of key benefits, most notably Pension Credit. The UK Government should address this directly through a UK-wide income maximisation campaign and design its messaging so that it not …

Gov response: The Department for Work and Pensions is undertaking a range of actions to raise awareness of Pension Credit and encourage eligible pensioners to claim, as part of a new national communications campaign, launched on 4 …

Accepted

#9 —

Work and Pensions Committee

Recommendation: The number of self-employed people saving in a pension has declined since the late1990s when it was around 48%, to around 16%. This is in stark contrast to the 88% of workers eligible for auto-enrolment participating in pension saving. Trials …

Gov response: The government is committed to make retirement saving simpler for self-employed people. The learnings from the trialling and research programme delivered through Nest Insight has provided a useful platform to move forward, helping us to …

Not Addressed

#4 — Require government to ensure and promote social tariffs for older people, strengthening regulation.

Women and Equalities Committee

Recommendation: Social broadband and mobile phone tariffs can allow eligible low-income households to make significant savings on their bills, yet few eligible older people are aware of them. The Government should work with groups representing older people and broadband and mobile …

Gov response: The government welcomes the Committee’s recommendation. We agree that access to connectivity services is increasingly essential. We also recognise that broadband and mobile services may not be affordable for those on very low incomes. We …

Partially Accepted

#16 — Hard-to-reach households showed low take-up of alternative energy support funding schemes.

Public Accounts Committee

Recommendation: Take–up of the energy bills support schemes was lower among harder–to–reach households that did not receive a payment directly from their energy supplier; 41 and may have been affected disproportionately by energy price fluctuations.42 These households did not receive an …

Gov response: 3.1 The government agrees with the Committee’s recommendation. Target implementation date: December 2025 3.2 The Warm Home Discount scheme currently supports over 3 million low income and fuel poor households with an annual energy bills …

Partially Accepted

#20 — Existing DWP trust issues impact older people's willingness to claim benefits.

Work and Pensions Committee

Recommendation: The Minister referred to the reputation of the Department and the reluctance of people to engage with it. We know that trust issues exist between working age people and the Department, and these will endure as they reach pension age. …

Gov response: To strengthen our communications approach, we are embedding messaging that positions DWP as a supportive service dedicated to helping people access their entitlements. This includes developing accessible materials in digital and print format, including resources …

Not Addressed

#19 — Pride and reluctance remain key barriers to Pension Credit take-up.

Work and Pensions Committee

Recommendation: We welcome the Government’s commitment to increase Pension Credit take-up and progress so far, with 60,000 additional awards since July 2024. Long experience and extensive research demonstrate that the main barriers to claiming relate to pride, not wanting to ask …

Gov response: The Department has made significant progress in implementing ‘place-based’ promotion through trusted advocates/ partners as part of our nationwide Pension Credit stakeholder outreach campaign. We also engage with all councils in Great Britain through regular …

Accepted

#12 — Winter Fuel Payment changes created significant uncertainty and anxiety among older pensioners

Work and Pensions Committee

Recommendation: Our predecessor Committee is amongst those that have criticised Winter Fuel Payments for being poorly targeted and a ‘blunt instrument’ for tackling fuel poverty. As a universal payment, WFP went to pensioners who did not need it, and its real …

Gov response: The Department has a statutory requirement to consider the Public Sector Equality Duty during the decision-making process, including analysing the impact of potential policies which includes older people. We note the Committee’s comments and can …

Not Addressed

#14 —

Work and Pensions Committee

Recommendation: The Pension Schemes Act 2021 will allow people’s statutory right to transfer from their pension scheme to be restricted where there are signs of a pension scam. Regulations will be developed by DWP and are expected to be in place …

Gov response: The Government believes that it is important that online platform operators take responsibility for the financial promotions they pass on. As part of our departure from the European Union (EU), the Government removed an exemption …

Under Consideration

#28 —

Work and Pensions Committee

Recommendation: Pensions dashboards will change how people engage with their pension savings. Dashboards will also provide an important additional tool which can be used by those providing guidance or advice to savers. We recommend that the Money and Pensions Service should …

Gov response: Individuals wishing to use dashboards will be able to delegate access to MaPS guiders or authorised financial advisers who have the relevant permissions under the Financial Services and Markets Act 2000 to advise on investments …

Not Addressed

#11 —

Work and Pensions Committee

Recommendation: Pension Credit provides vital support for pensioners, yet some 850,000 eligible households do not claim it. The rising cost of living means this must now be urgently addressed. The Government’s efforts are focused on a communications campaign. The Committee heard, …

Gov response: The 850,000 figure is an estimate based on the Family Resources Survey. The Department does not consider that a written strategy or targets for take-up of Pension Credit are required, given the work it is …

Not Accepted

#11 — Devise and implement policy addressing unfairness for low-income pensioners missing Pension Credit.

Work and Pensions Committee

Recommendation: We commend the Government’s efforts to promote Pension Credit to those entitled to it, though there is still more to do to increase take-up as we remarked on in our July 2022 Cost of Living report. We remain concerned that …

Gov response: Pension Credit provides additional support with daily living costs for people who are over State Pension age and on the lowest incomes. Pensioners with a severe disability, carers and those who are responsible for a …

Accepted

#17 — Communication failures hampered support scheme reach to vulnerable households in need

Public Accounts Committee

Recommendation: Although the Department worked with local authorities on some of the schemes aimed at households who were harder to reach,44 the low take–up suggests that this approach did not identify all those in need.45 The Department said that it attempted …

Gov response: 3.1 The government agrees with the Committee’s recommendation. Target implementation date: December 2025 3.2 The Warm Home Discount scheme currently supports over 3 million low income and fuel poor households with an annual energy bills …

Partially Accepted

#28 — Government recognises need for improved data sharing to increase means-tested benefits take-up.

Work and Pensions Committee

Recommendation: We welcome the Government’s recognition of the importance of better data sharing arrangements to increase take-up of means-tested benefits, and the work it is doing to address the issues. (Conclusion, Paragraph 141)

Gov response: The Department already shares extensive data with local authorities. There are currently 28 bulk data shares with local authorities, some of which also include HMRC data, where information is shared between DWP and local authorities …

Accepted

#27 — Encourage using Crisis and Resilience fund for benefits take-up and assess advice sector capacity needs.

Work and Pensions Committee

Recommendation: When the guidance is produced, it should encourage the use of the Crisis and Resilience fund for benefit take-up work. The Government should assess what more is needed to increase the advice sector capacity needed to support this work. (Recommendation, …

Gov response: The Crisis and Resilience Fund will enable local authorities to provide preventative support to communities in order to improve individuals’ financial resilience. The Government recognises the importance of maximising benefit take-up in preventing financial crisis …

Not Addressed

#25 — Develop a national strategy for benefits take-up in England and monitor local authority performance.

Work and Pensions Committee

Recommendation: DWP should develop a strategy for benefits take-up in England by the end of 2025. It should work with the Ministry of Housing, Communities and Local Government to develop a framework for monitoring local authority work on take up and …

Gov response: The Government notes the Committee’s recommendation. Many local authorities undertake activities to promote benefit take-up. DWP’s Local Authority Partnership, Engagement and Delivery (LA-PED) team support local authorities in the delivery of Housing Benefit and other …

Not Accepted

#24 — Many local authorities lack resources to coordinate effective benefits take-up support.

Work and Pensions Committee

Recommendation: Effective take-up work requires, firstly, face to face support and encouragement from trusted individuals and organisations on the ground. The complexity of the benefits system means that expert welfare rights advice is often also needed. In some areas, local authorities, …

Gov response: The Department already has resource plans in place to ensure claims to Pension Credit and other benefits are processed in a timely manner. These plans are reviewed on a regular basis to reflect the volumes …

Not Addressed

#23 — Include caring questions in Pension Credit and raise awareness for UC claimants about entitlement.

Work and Pensions Committee

Recommendation: The Government should include questions on caring responsibilities in the Pension Credit application and implement provisions in the Welfare Reform Act 2012 to allow direct access to the carer addition in Pension Credit without a claim for Carer’s Allowance. It …

Gov response: The Government acknowledges that the current system which requires a person to claim Carer’s Allowance (CA)—which for most pensioners will not be payable alongside the State Pension—in order to qualify for an additional amount in …

Partially Accepted

#21 — Allocate resources for efficient claims, provide expert advice, and promote benefits proactively.

Work and Pensions Committee

Recommendation: The Department should put in place the resources needed to process claims in an efficient and timely manner and helpline advisers able to give the advice needed to navigate the system in more complex cases. The Government communications on social …

Gov response: The Department already has resource plans in place to ensure claims to Pension Credit and other benefits are processed in a timely manner. These plans are reviewed on a regular basis to reflect the volumes …

Accepted

#11 — 2024/25 Winter Fuel Payment eligibility poorly targeted, while 2025/26 reforms are welcomed

Work and Pensions Committee

Recommendation: For winter 2024/25, the Government linked eligibility for the Winter Fuel Payment to receipt of Pension Credit. This removed the payment from many who needed it and set the bar for continued payment too low. Up to 760,000 pensioner households …

Gov response: The Department has a statutory requirement to consider the Public Sector Equality Duty during the decision-making process, including analysing the impact of potential policies which includes older people. We note the Committee’s comments and can …

Not Addressed

#1 — Pensioner poverty has risen since 2010, leaving millions below the Minimum Income Standard.

Work and Pensions Committee

Recommendation: The reductions in pensioner poverty in the late 1990s and 2000s, with the introduction of Pension Credit, were a success. However, we are concerned that from 2010 rates started to rise again. And the latest data on living standards paints …

Gov response: The Government recognise that pensioner poverty is often the result of compounding disadvantages that start long before retirement which is why state support is provided accordingly. For example, we have increased the National Living Wage …

Accepted

#36 —

Work and Pensions Committee

Recommendation: Members of schemes where professional trustees are appointed can face long waits to receive any recovered assets, even if a significant proportion of the assets are recovered. Often because of the costs associated with providing communications to members, which are …

Gov response: Pension scams are devastating, and we understand how disappointing it must be for victims to find independent trustee charges have reduced the amount that can be returned to them further. However, in most cases, by …

Not Addressed

#33 —

Work and Pensions Committee

Recommendation: HMRC has been described as “unrelenting and uncompromising” in the pursuit of unauthorised payment charges. While the position taken by HMRC is legally correct, it has often lacked empathy or understanding of impact that its demands have on victims. We …

Not Addressed

#30 —

Work and Pensions Committee

Recommendation: Project Bloom is a multi-agency task force set up to tackle pension fraud in 2012. It is not a statutory body and receives no dedicated funding. The members of Project Bloom have argued convincingly to us that it has the …

Gov response: It is unlikely to be in a member’s best interest to transfer out of a scheme before attempts to recover assets have been concluded. Savers who left the scheme early would potentially miss out on …

Under Consideration

#28 —

Work and Pensions Committee

Recommendation: Regulators exist to protect savers and not enable scammers. Where a regulator has failed in this fundamental duty they should be held accountable. We recommend that the Government review the recourse available to pension scam victims when the actions of …

Gov response: Her Majesty’s Revenue & Customs (HMRC) is currently a member of the Project Bloom Communications Group and works alongside the other members to help promote the warning signs of scams. HMRC has always co-operated with …

Under Consideration

#25 —

Work and Pensions Committee

Recommendation: There are many bodies with potentially overlapping enforcement responsibilities relating to pension scams. These include, but are not necessarily limited to: the Pensions Regulator, the FCA, the Insolvency Service, HMRC, Information Commissioner’s Office, the police service, the Serious Fraud Office, …

Gov response: Project Bloom operates on the basis of partnership working and has no statutory footing. We agree that it could benefit from being placed on a more formal footing within the existing partnership. Central coordination of …

Under Consideration

#22 —

Work and Pensions Committee

Recommendation: When the pension freedoms were introduced, a guidance guarantee was presented as a key pillar of the reforms supporting people making use of the new range of choices available to them. Everyone with a defined contribution pension is entitled to …

Gov response: The Financial Conduct Authority seeks to reduce the incidence of fraud through a framework of prepare, prevent, protect and pursue. They collaborate extensively with other agencies, including as one of the seven core National Economic …

Under Consideration

#15 —

Work and Pensions Committee

Recommendation: The regulations will identify potential indicators of a pension scam which would raise either red or amber flags. A red flag would allow a transfer to be blocked and an amber flag would allow a transfer to be paused until …

Gov response: The Government has recently announced that, following close engagement with a broad range of stakeholders, online fraud will be included in scope of the Online Safety Bill. This means that companies in scope of regulation …

Under Consideration

#11 —

Work and Pensions Committee

Recommendation: The pensions industry does not universally share information about possible scams amongst providers and schemes. Information can be, and is, shared voluntarily, including through the Pension Scams Industry Group and the forum it supports— the Pension Scams Industry Forum. WWee …

Gov response: The Government agrees with this recommendation and it fits within the plans of the Department for Work and Pensions (DWP) to review the policy. Scams are ever evolving and DWP recognises the importance of making …

Accepted

#9 —

Work and Pensions Committee

Recommendation: We heard repeatedly about a worrying trend of secondary scammers—scammers targeting people who have already been the victim of a pension scam. People who have not reported their case to an appropriate body—or who have done so but not received …

Gov response: The Pensions Regulator (TPR) launched the industry-focused Pledge campaign, working closely with the Pension Scams Industry Group (PSIG) in November 2020. It encourages industry to make a public pledge to combat pension scams and to …

Under Consideration

#8 —

Work and Pensions Committee

Recommendation: The aftermath of a pension scam can leave a victim needing to deal with several different bodies without much guidance or support. For many victims Action Fraud is the first point of contact and for those for whom it is …

Gov response: Project Bloom is exploring options for improved coordination of industry intelligence via its National Economic Crime Centre led Intel & Ops Group. We are also emphasising the need for increased industry reporting to Action Fraud …

Under Consideration

#7 —

Work and Pensions Committee

Recommendation: Many victims of pension scams never report that they have been scammed. Others report a long time after it has taken place. Scam victims reasonably expect that, when they make a report to Action Fraud, it will be acted upon. …

Gov response: The Government continues to stress the importance of reporting instances of fraud to Action Fraud, both to support police investigations as well as allowing the development of a stronger intelligence picture across a range of …

Under Consideration

#6 —

Work and Pensions Committee

Recommendation: At present there is no universal definition of pension scams and the range of potential activity which could be classed as a scam runs from sharp practice all the way to outright fraud. Project Bloom, the multi-agency taskforce set up …

Gov response: We agree the issue of secondary scammers awareness must be increased and it is an important issue. The Money and Pensions Service also provide guidance on secondary scammers. The Pensions Regulator and the Financial Conduct …

Under Consideration

#5 —

Work and Pensions Committee

Recommendation: We recommend that Project Bloom, the multi-agency taskforce set up to tackle pension scams, should develop a range of measures to enable a better understanding of the scale of pension scamming, rather than relying solely on the current Action Fraud …

Gov response: Action Fraud is the national reporting service for fraud and cybercrime. Reports are submitted, considered by the National Fraud Intelligence Bureau, and disseminated to forces for investigation where there is a viable line of enquiry. …

Under Consideration

#4 —

Work and Pensions Committee

Recommendation: The real scale of pension scamming is undoubtedly much larger than the £30 million reported to Action Fraud, the UK’s national reporting centre for fraud and cybercrime, between 2017 and August 2020. We have even heard examples of individual cases …

Gov response: The City of London Police (CoLP) are the National Lead Force for fraud, and responsible for the delivery of the Action Fraud Service. They are an active member of Project Bloom and report into them …

Under Consideration

#2 —

Work and Pensions Committee

Recommendation: The pension freedoms gave people more choice in how they use their money to meet their own needs. However, by offering pension savers access to a much wider range of investments, the freedoms also removed much of the distinction between …

Gov response: Both the Government and Project Bloom members recognise the difficulty in determining the scale of pension scams and the barrier this creates in effectively tackling the problem. We accept the Committee’s observation that the real …

Under Consideration

#1 —

Work and Pensions Committee

Recommendation: The pension freedoms gave people the freedom to choose what to do with their money. On balance these changes have been a success and we do not want to see them rolled back. However, many savers need more support than …

Gov response: The government is fully committed to providing savers with the relevant information and support in order for them to make appropriate decisions when they access their pension. Until we know more about what is already …

Under Consideration

#1 —

Work and Pensions Committee

Recommendation: The Government has not acted on our recommendation to set a target of at least 60% for the combined use of Pension Wise and paid for advice when accessing pension pots for the first time. It also rejected our recommendation …

Gov response: The government is committed to continually monitor the use of Pension Wise which now includes the impact of the Stronger Nudge. We will continue to work with MaPS to consider feedback on users’ experience of …

Not Addressed

#24 —

Work and Pensions Committee

Recommendation: We are reassured to hear that the process for claiming Attendance Allowance seems to broadly be working well. However, we were concerned about the challenges around take-up, which reflect those around Pension Credit. We recommend DWP develop targeted interventions to …

Gov response: Information on Attendance Allowance (AA) is already widely available, including online through Gov.UK. Organisations supporting older people and other stakeholders and partners, also make information available on Attendance Allowance. The Department is introducing a digital …

Accepted

#4 — Implement a social tariff and efficiency measures for vulnerable households, streamlining existing schemes.

Energy Security and Net Zero Committee

Recommendation: We urge the Government and energy suppliers to consider implementing a form of social tariff and other measures to protect vulnerable households from being cut off from their energy supplies. We note the challenges vulnerable households can face in benefiting …

Gov response: The department engages with a range of stakeholders and is continuing to explore options for the best approach to consumer protection, as part of wider retail market reforms. The Government acted swiftly to provide support …

Under Consideration

#12 — Introduce measures to improve sole trustee accountability and member involvement in appointments

Work and Pensions Committee

Recommendation: The use of sole trustees is increasing. While they can bring knowledge and expertise, there is the potential for conflicts of interest. We are concerned that employers often have a unilateral power to appoint sole trustees in the place of …

Gov response: As the WPSC highlight, there is an increase in usage of professional sole trusteeship. This trend is not only affecting DB schemes but is being experienced across all types of trust-based pension scheme. Research from …

Under Consideration

#9 — Introduce auto-enrolment for all eligible children in free school meals without delay.

Education Committee

Recommendation: We consider that the arguments for auto-enrolment in free school meals for those children currently eligible are conclusive. In the interests of alleviating hunger in schools and improving health and educational outcomes for the poorest children, auto-enrolment must be brought …

Gov response: Government response to Conclusion eight: We recognise the vital role played by free school meals and encourage all eligible families to take up their entitlement. We currently facilitate the process of claiming free meals through …

Partially Accepted

#19 — Domestic energy debt has significantly increased, becoming the fastest growing type of consumer debt

Public Accounts Committee

Recommendation: Alongside a rise in energy prices, Ofgem statistics from June 2024 show the total owed by domestic consumers for both electricity and gas was over £3.7 billion compared with £1.8 billion at the end of 2021.51 A report by Clear …

Gov response: 4.1 The government disagrees with the Committee’s recommendation. 4.2 To address the Committee’s concerns, the department proposes an alternative approach, recommending that Ofgem, as the market regulator, is better suited than DESNZ to collect pertinent …

Not Addressed

#3 — Develop strategies for next winter to support consumers at greater risk of fuel poverty.

Public Accounts Committee

Recommendation: The Department has not done enough to address the challenges of providing financial support to vulnerable consumers in the event of another crisis. The Department reported that between mid–2022 and mid–2023 the Energy Price Guarantee (EPG) and Energy Bills Support …

Gov response: The government agrees with the Committee’s recommendation. fuel poor households with an annual energy bills rebate of £150. The government has consulted on expanding eligibility in England and Wales to all households where the bill …

Accepted

#35 — Passported benefit cliff-edge creates significant hardship for pensioners just above Pension Credit threshold.

Work and Pensions Committee

Recommendation: The reason the new State Pension was set above the Pension Credit Guarantee was to improve savings incentives. However, over the years more ‘passported benefits’ have become linked to it, meaning that being just a few pounds above Pension Credit …

Gov response: The primary purpose of Pension Credit is to alleviate pensioner poverty by providing direct financial support to pensioner households on the lowest incomes. Pension Credit does this by guaranteeing a minimum level of income—the Standard …

Not Accepted