Winter Fuel Payment U-turn 'creating uncertainty' for older Britons as Pension Credits claims soar

This represents a 57 per cent increase in awards compared to the same period in the previous year with the DWP receiving a 51 increase in Pension Credit claims since the Winter Fuel Payment announcement was made.

The benefit serves as a top-up for pensioners on the lowest incomes and provides eligibility for the Winter Fuel Payment alongside other benefits such as a free TV licence.

Jon Greer, the head of retirement policy at Quilter, described Pension Credit as "perennially underclaimed" by those who are otherwise eligible.

However, he noted the Government's decision had "clearly kicked many into action to start claiming it in order to receive the highly prized payment".

This is despite the surge in applications created significant processing delays that left many pensioners waiting far longer than expected.

Green cited that "Pension Credit application processing times peaked at 87 working days in December 2024, significantly above the Department for Work and Pensions' (DWP) 50-working-day target".

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He added: "If we are to make the drive to get people on the correct benefits, we must not be leaving them in limbo for that long."

Not all applications were successful, with 146,000 claims rejected during the period because applicants were not eligible, representing a 99 per cent increase compared to the previous year.

According to Greer's Freedom of Information request (FoI), "the service has worked hard at clearing the backlog reducing it from 85,500 at its peak in December 2024 to 10,800 in mid-May this year".

Greer warned that the government had "created uncertainty" after announcing "it would like more people to be eligible for the Winter Fuel Payment without saying how it will decide how people will be assessed for it in the future".

Greer said: "A lot of progress has been made in getting more people who should be receiving pension credit to apply for it, but without clarity on the Winter Fuel Payment, that progress may now stall."

The uncertainty comes despite the successful surge in applications following the initial means-testing announcement.

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Despite the surge in applications, over one million pensioners remain without their Pension Credit entitlement, according to Morgan Vine, director of policy and influencing at later life charity Independent Age.

"While this increase in Pension Credit recipients is a positive step, it is sadly still a drop in the ocean," he said.

The benefit provides substantial financial support, with recipients receiving an average top-up of £4,000 per year.

To qualify, pensioners must have reached state pension age and meet income thresholds of £227.10 weekly for singles or £346.60 for couples.