Marvin OnumonuMPs have called for a UK-wide plan to reduce pensioner poverty after a report from the Work and Pensions Committee found nearly one in six pensioners were living in relative poverty.
The report showed poverty was higher for those renting, carers, and disabled people.
The committee said the Government should set a minimum income for a dignified retirement and make sure everyone gets it, rather than relying on benefits like pension credit and housing benefit.
The committee found pension credit worth up to £4,000 a year was not being claimed by about 700,000 households.
Take-up has sat between 61% and 66% for a decade.
Last year, linking winter fuel payments to pension credit resulted in 60,000 more awards, but the report noted there was still a long way to go.
The committee recommended the Government should come up with a strategy to boost pension credit take-up in England by the end of 2025.
The report highlighted the pension credit threshold created a cliff-edge where pensioners just above the weekly income threshold of £227.10 for singles or £346.60 for couples missed out on extra benefits.
The committee said a taper for pension credit should be considered to help avoid this problem.
It also found more pensioners renting privately, making them more likely to be in poverty.
The report noted 2.1 million people were on less than the basic state pension, with women more likely to miss out.
The committee pointed out the mixed-age couple rule, which blocks pension credit if one partner is below pension age, was not fair.
Debbie Abrahams, chair of the Work and Pensions Committee, said: “Poverty is insidious. It isolates, damages health, and strips you of dignity. After decades of contributing to society dignity in retirement is the least you deserve.
“But too many are forced to make sacrifices that will accelerate their ageing because they don’t have enough to live on.
“To boost incomes, the Government needs to come up with a strategy to increase Pension Credit take-up.”
Abrahams added: “It’s a scandal that so many have missed out for so many years, often through an aversion to claiming benefits altogether, or lack of support.
“The fairness of the Pensions Credit eligibility criteria where if you are a penny above the threshold, you miss out on thousands of pounds, also needs to be looked at.
“Ultimately, the Government should decide what it thinks is enough for a dignified retirement, and then work to ensure that all pensioners are on at least that level.”
She said: “Faced with a combination of high energy costs, ill-health and ever higher rates of pensioners in more costly privately rented accommodation, tackling pensioner poverty is not simply a DWP issue.
“So, we’re calling for a nationwide, cross-government strategy for an ageing society that should be rooted in equity and wellbeing.
“Earlier this week the Government relaunched the Pensions Commission that will look into how future pension savings could be boosted to help future pensioners.”
She added: “While we welcome this, we are keen to ensure that those reliant right now on a state pension that leaves them short are looked after too.”
Caroline Abrahams, charity director at Age UK, said, “We warmly welcome this thoughtful and wide-ranging Select Committee report, which comes closer to providing a thorough and progressive strategic overview of the issues facing older people on low incomes and proposing workable solutions than anything successive governments have produced in recent years.
“This is to the Committee’s great credit, but it is also an indictment of the lack of focus from our political leaders in preventing and tackling pensioner poverty, the incidence of which is growing, with the result that approaching 3 million older people are now on less than is required for a minimum decent standard of living.
“Many of the individual recommendations in the report are excellent and we would particularly spotlight those relating to the need for a cross-government strategy on an ageing society; an Older People’s Commissioner in England; a social tariff for energy; and a comprehensive DWP strategy to promote benefit uptake, including of Pension Credit, the low take up of which this cross party Committee rightly terms ‘a scandal’.”
Abrahams added: “The Committee also correctly questions the fairness of the ‘mixed age couple’ benefit rule –– which can mean people in their 70s and beyond still receiving working-age benefits – and the adequacy of financial support for older people who rent their homes.
“When the Government announced the launch of the Pensions Commission earlier this week, Ministers made it clear that its task is to think about the creation of a better system for future pensioners.
“This is necessary and important, but this Committee report reinforces the point that there’s work to do to improve the situation of today’s pensioners on low incomes as well.”
She said: “The State Pension triple lock makes an important contribution to sustaining pensioner incomes but, as the statistics show, it is not enough on its own and the scourge of pensioner poverty has by no means gone away.
“We hope the Government will respond positively to this report, much of which has the potential to improve the lives of older people in our country, especially those living on low and modest incomes.”
