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Pensions Update

Statement made on 14 January 2019

Statement UIN HCWS1249

Statement

The Government’s reforms to the welfare system are designed to support those who need it and help people into work. We have reduced pensioner poverty to close to historically low levels and the triple lock on the State Pension has helped lift the incomes of millions of pensioners. Since 2010, we have increased the annual level of the basic State Pension by £1,450. In 2018/19 we will spend £121.5 billion on benefits for pensioners and by 2023/24 this rises to £143.5 billion.

In 2012, Parliament voted to modernise the welfare system to ensure that couples, where one person is of working age and the other person is over state pension age, access support, where it is needed, through the working age benefit regime. This replaces the previous system whereby the household could access either Pension Credit and pension age Housing Benefit, or working-age benefits.

Pension Credit is designed to provide long-term support for pensioner households who are no longer economically active. It is not designed to support working age claimants. This change will ensure that the same work incentives apply to the younger partner as apply to other people of the same age, and taxpayer support is directed where it is needed most.

I set out to Parliament last year that this change would be implemented once Universal Credit was available nationally for new claims. Today I can confirm that this change will be introduced from 15th May 2019. The change is being brought into effect in Great Britain through a Commencement Order[1] under the Welfare Reform Act 2012. There will be an equivalent Order to introduce the change for Northern Ireland.

Couples with one partner under State Pension age who are already in receipt of Pension Credit or pension-age Housing Benefit at the point of change will be unaffected while they remain entitled to either benefit.

In February 2017, Government published an employer-led Strategy “Fuller Working Lives: A Partnership Approach”, which sets out the importance of Fuller Working Lives for employers and individuals. It also sets out action Government is taking to support older workers to remain in the labour market.

[1] The Welfare Reform Act 2012 (Commencement No. 31 and Savings and Transitional Provisions and Commencement No. 21 and 23 and Transitional and Transitory Provisions (Amendment)) Order 2019

Linked statements

This statement has also been made in the House of Lords

Department for Work and Pensions
Pensions Update
Baroness Buscombe
The Parliamentary Under Secretary of State, Department for Work and Pensions
Conservative, Life peer
Statement made 15 January 2019
HLWS1216
Lords