State pensioner unable to get £650 cost of living payment due to pension credit threshold | Personal finance | Finance

Cindy, 68, whose name has been changed, has contacted to share her situation and underline the “injustice” she feels. After working for over 51 years, Cindy is entitled to a full pension of £185.15 a week. However, earning the full amount means she is not eligible for pension credit as she exceeds the limit of £182.60 per week.

She said: ‘So because I have an extra £2.55 a week I’m not eligible for pension credit, which is a gateway to many other benefits.

Being born in 1954 meant she was among the women born in the 1950s affected by the increase in the retirement age for women. The changes meant she had to wait until December 2020 to receive her pension, even though she turned 65 in December 2019.

Cindy said that for most of her life she worked in administrative positions and earned little more than minimum wage.

The state pension is her only income, apart from the lump sums she had taken from her occupational pensions.

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She had work pensions worth £3,500 and £600 which she cashed in to help her get by since she retired.

To apply for the pension credit she phoned and told them she was getting the new full state pension and the employee told her she was over the maximum amount so she couldn’t give her the service.

Pension Credit is a top-up, so it would only exceed her income up to £2.55 below her current income, but Cindy pointed out that this was a gateway benefit – opening the eligibility for other forms of support.

She said, “It’s so bad, you’re less likely to work unless you have a really good job and earn enough.

“But if you’re at the bottom of the pile where I was, just above minimum wage, you’re never going to break even.


She felt aggrieved because the pension credit is a gateway to many other benefits and discounts.

She said: “It’s not even just Pension Credit, it’s a gateway to everything, that’s what really pissed me off. Even the way the Chancellor gives pensioners £650 through Pension Credit has me fired up.

“It’s unfair just because I have full board. I think this is a great injustice.

If someone is eligible for pension credit, they can also get other help, such as:

Housing allowance if they rent the property they live in

  1. Coverage of mortgage interest if they own the property they live in
  2. A residence tax reduction
  3. A free TV license if you are 75 or older
  4. Help with NHS dental care, glasses and transport costs for hospital appointments
  5. Help them pay for their heating costs with the Warm Home rebate program
  6. A discount on the Royal Mail redirect service if they move house

She thinks there might be other people in a similar situation to her.

“It would be better if I didn’t get the full state pension so I could qualify for other things,” she said.

To obtain the full state pension, a person must have 35 years of national insurance contributions. If someone has less, he will receive a smaller pension.

But people can fill in the gaps by making voluntary contributions, called class 3 contributions.

This must generally be done within six years, but there are some exceptions.

Fortunately, Cindy will be eligible for the additional £300 pensioner payment recently announced by Rishi Sunak to help during the cost of living crisis.

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