New Winter Fuel Payment update after DWP releases pensioner poverty report
The charity Independent Age has said the estimates around the number of State Pensioners who may be forced into poverty following the eligibility rule change to Winter Fuel Payments are “extremely alarming” and insisted the UK Government must reverse its decision on means-testing the annual heating bill help. Only pensioner households receiving benefits such as Pension Credit, Tax Credits, or Universal Credit will be entitled to a payment of up to £300.
Morgan Vine, director of policy and influencing at the charity, said: “It’s extremely alarming to learn that an estimated 100,000 older people could be pushed into poverty as a direct consequence of changes to the Winter Fuel Payment. The UK Government’s own analysis has now revealed the extent of the devastating impact of limiting the payment to just those on Pension Credit. With this information now in the open, it is essential Ministers put a stop to this policy change right away.”
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Vine continued: “At Independent Age we can already see the terrible impact this policy decision is having, the older people living on a low income that we speak to feel forced into making drastic cutbacks. We have heard harrowing stories of people going to bed in hats and coats, washing in cold water, only heating one room and visiting public places to stay warm. This is unacceptable.
“With almost two million older people already living in poverty, this data is further evidence that the UK Government should change course and ensure everyone who needs the Winter Fuel Payment continues to receive it.”
The change to Winter Fuel Payments will force 100,000 pensioners into poverty in 2026, according to the UK Government’s own estimates.
Chancellor Rachel Reeves announced the policy change in July in an effort to plug a £22 billion hole” in the economy left by the Conservatives. The Winter Fuel Payment cuts will affect over 10 million pensioners, including 850,000 in Scotland, but is expected to save the public purse £1.5bn a year.
The move has been criticised by campaigners and opposition parties, while Sir Keir Starmer’s colleagues in Scottish Labour have set out plans to partially reverse it - if they win the next Holyrood election.
Under their plans, all pensioners would receive the payment initially, but it would be tapered over the years to reflect the income of recipients, with those who are better off receiving less in the longer term.
Despite the official modelling, Sir Keir insisted elderly Britons would still be “better off” due to the increase in the State Pension.
Work and Pensions Secretary Liz Kendall revealed the Government’s assessment of the impact in a letter to MPs, but stressed the figures did not take into account plans to increase the numbers on Pension Credit.
She told the Work and Pensions Committee: “The latest modelling shows that compared to the numbers that would have been in poverty without this policy, it is estimated that in each year in question there will be an additional 50,000 pensioners in relative poverty after housing costs in 2024-25, 2025-26 and 2027-28, instead.
“The modelling also shows that an additional 100,000 pensioners are estimated to be in relative poverty after housing costs in 2026-27, 2028-29 and 2029-30.”
Households in relative poverty have less than 60 per cent of average (median) income in the current year.
The number of additional pensioners in absolute poverty – compared to the median in 2010/11- is estimated to be 50,000 in each year.
Ms Kendall said the Labour Government had been “forced” to limit the payment due to the “£22 billion black hole” it blamed the Conservatives for leaving behind.
In her letter, she wrote: “Means-testing Winter Fuel Payments was not a decision this Government wanted or expected to take. However, we were forced to take difficult decisions to balance the books in light of the £22 billion black hole we inherited.
“Given the dire state of the public finances, it’s right that we target support to those who need it most while we continue our work to fix the foundations and stabilise the economy -which is the best way to support pensioners in the long term and is what has allowed us to deliver our commitment to the triple lock.”
She said the “modelling does not take into account any impacts of the measures we are taking to increase Pension Credit take-up and to ensure pensioners get the benefits to which they are entitled”.
Debbie Abrahams, the Labour chairwoman of the Work and Pensions Committee, said: “While we’re grateful for the Government’s transparency on this, there are some outstanding issues on the specific impact on older or disabled pensioners, and the figures say nothing of those floating just above the poverty line.
“We remain concerned by the impact that restricting Winter Fuel Payments might have on poorer pensioners. We’ll be watching the issue closely.”
Shadow work and pensions secretary Helen Whately said: “Finally the dam breaks and we get to see what Labour have known all along. Their Winter Fuel Payment cuts are going to plunge 100,000 pensioners into poverty in the next few years.
“Clearly Keir Starmer feels like that’s a price worth paying to make a political point. But I don’t think those pensioners would agree with him.”
Liberal Democrat Treasury spokeswoman Daisy Cooper said: “Faced with these shocking figures, the Government must step up and do the right thing: finally reverse the Winter Fuel Payment cut.”
How to check eligibility for Pension Credit
Older people, or friends and family, can quickly check their eligibility and get an estimate of what they may receive by using the online Pension Credit calculator on GOV.UK here.
Alternatively, pensioners can contact the Pension Credit helpline directly to make a claim on 0800 99 1234 - lines are open 8am to 6pm, Monday to Friday.
Expert help and advice is also available from:
New claims for Pension Credit made before December 21, 2025 which later turn out to be successful will also qualify for a backdated Winter Fuel Payment.
More details about claiming Pension Credit can be found on GOV.UK here.