Pensioners protest over means-tests

Thousands of elderly people are today expected to join demonstrations calling for a boost to the universal basic state pension - on the day when the Government's means-tested new Pension Credit comes into effect.

The Government says that the Pension Credit will target extra cash at the poorest pensioners, ensuring that no-one over 60 has to get by on less than £102.10 a week for single people and £155.80 for couples.

The credit will also reward people over 65 who have modest amounts of savings, with extra payments of up to £14.79 for a single person and £19.20 for a couple.

Work and Pensions Secretary Andrew Smith said that half of pensioner households would be better off by around £400 a year thanks to the credit, for which some 5.1 million older people are eligible.

But campaigners argue that many of those who need help will miss out because they are unwilling to undergo means-testing or find the credit too complicated to claim.

They are calling for the restoration of the link between the level of the basic state pension and average earnings.

The link was broken by Margaret Thatcher in 1980 and subsequent rises have been in line with price inflation. Campaigners say the result has been to cut pensions by around £30 a week in real terms.

Labour has resisted pressure to restore the link, arguing that it is better to target any extra cash at the poorest old people through the Minimum Income Guarantee and the new Pension Credit.

But Tories announced that they would revive the earnings link if they came to power, as part of a long-term policy of to phase out dependency on means-tested benefits.

Mr Smith said: "Pension Credit will ensure that at least half of pensioner households in the country are something like an average of £400 a year better off. The great thing about Pension Credit is it rewards people with modest occupational pensions and savings."

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