Memorandum submitted by Local Government
Association (LGA) (PC 02)
PENSION CREDIT
The Local Government Association (LGA) welcomed
the creation of Pension Credit as one of the ways to help eradicate
pensioner poverty as detailed in the LGA Older Peoples Shared
Priority.
The new Savings Credit element of the benefit
has resulted in increased income for some pensioners who previously
failed to qualify under the Minimum Income Guarantee criteria.
Whilst this increase is welcome, the benefit has done nothing
to raise the standard of living for the poorest pensioners in
the country and has in fact increased the "gap" between
pensioners who have been able to make some provision for their
old age and those pensioners who have no savings or occupational
pensions.
The claims procedure is still complex with a
lengthy form requiring extensive verification of all financial
data detailed on the form. A great deal of this financial information
is already held by central government departments and benefit
recipients find the procedures difficult. The LGA welcome the
increased staffing of local Pension Service visiting officers
to assist pensioners with their Pension Credit claims and the
introduction of Joint Teams which has increased data sharing between
local and central government.
The impact of Pension Credit awards on other
benefits such as Housing Benefit and Council Tax has not been
helpful with the result that some pensioners have undergone the
complex claims procedures to end up with very minimal increases
in overall income. The abolition of the capital ceiling has lead
to pensioner confusion where capital cut off rules remain for
other benefits and service provision.
The LGA welcomed the extensive marketing campaign
to publicise and increase awareness of the new benefit. The television
and national press adverts were useful. The current targets for
Pension Credit take up seem to be low compared with the estimates
of prospective benefit recipients and it is important that all
new pensioners are made aware and receive correct advice re Pension
Credit. Research has shown that take up is still low amongst black
and minority ethnic groups and networking with local community
groups is vital to provide the links between local and central
government.
It is clear that there is more work to be done
to increase Pension Credit take up and to investigate the overall
effect of the benefit on pensioners incomes overall. The impact
of the benefit on future pensioners who are likely to retire with
higher occupational pensions will also require further investigation
if the Savings Credit element is to be seen as a real incentive
and reward for making some provision for retirement.
THE CONTRIBUTION
PLAYED BY
PENSION CREDIT
TO THE
INCOMES OF
CURRENT AND
FUTURE PENSIONERS
1. Pension Credit has done nothing to increase
the incomes for the poorest pensioners in the country. The divide
is now greater between those pensioners who have some savings
and an occupational pension.
2. The reward element of the benefit has
been welcomed by pensioners who have seen their incomes increase
as a result of them making some retirement provision. The current
scheme is less advantageous to older women as many of them do
not receive any occupational pensions and are therefore less likely
to qualify for Savings Credit. The fact that there is no capital
"cliff edge" has been welcomed and many pensioners who
had savings marginally above tariff cut off levels are better
off.
3. The effect of the benefit on future pensioners
will depend greatly on their level of savings and their secondary
pension income. Careful consideration will need to be factored
into the rules relating to the Savings Credit if this is to remain
an incentive for making provision for pensioners' retirement.
THE INTERACTION
OF PENSION
CREDIT WITH
OTHER BENEFITS
AND WITH
LOCAL AUTHORITY
CARE CHARGING
POLICIES
4. The interaction with Housing Benefit
and Council Tax has had an adverse effect on the take up of Pension
Credit. Many prospective benefit recipients have not claimed,
as their overall gain was very small after adjustments are made
to their Housing Benefit and Council Tax. Many pensioners felt
that they could not cope with a second set of forms to complete
for notifying the Housing Department. The fact that there is still
a tariff ceiling on Housing Benefit and Council Tax entitlement
has caused some confusion for pensioners as well as increasing
the complexity of training for advisors.
5. The effect of the additional Savings
Credit has had a minimal effect on the service charge provision
but barriers re data sharing have caused some problems with some
pensioners having to supply information to several different departments.
6. The complexities of the Severe Disability
Premium and the link with Attendance Allowance continues to cause
major problems where customers are misadvised by Pension Centres
resulting in the loss of large amounts of benefits. Processing
staff frequently miss the award of the premium and resolution
of these problems is often time consuming.
TAKE UP
OF PENSION
CREDIT
7. There was good publicity within the national
papers and via television advertisements that helped raise the
awareness of the new benefit.
8. Take up amongst black and minority ethnic
groups is low and links need to be established with local communities
to increase benefit take up. Much of the DWP's campaign has been
aimed at written communications with leaflets being translated
into a variety of languages. Literacy levels amongst many of these
groups are low therefore awareness levels of Pension Credit are
low.
9. Greater use of existing data could be
used to better effect maximising limited resources. Data exchange
between Joint Local Authority and DWP teams has helped to target
`hard to reach' customers. It is clear that if data from the Inland
Revenue re capital and other income could be used that better
targeting of prospective benefit recipients would occur.
CONSEQUENCES OF
THE DEPARTMENT'S
PLANS TO
REDUCE ITS
WORKFORCE AND
NUMBER OF
PENSIONS CENTRES
10. Local Authorities are concerned about
the DWP announced efficiencies with reductions in staffing levels
and the planned closures of some DWP outlets. Many Local Authority
staff have invested a lot of time and effort in establishing good
local links with the local Pension Service especially in the establishment
of Joint Teams and partnership working. Some of the closures will
result in the relocation of some recently established Joint Teams
causing further disruption and expense.
11. The closure and relocation of Pension
Credit processing centres is likely to adversely affect processing
speed and accuracy until new staff gain experience and will also
mean having to establish new working protocols and networks.
DELIVERY OF
A TELEPHONE
BASED SERVICE
TO PENSIONERS
12. The creation of a telephone-based service
has been a useful service for many pensioners who wish to conduct
their business by telephone in the comfort of their own homes.
13. The service is not appropriate for all
users and customers with a hearing impairment have major problems
trying to claim in this way.
14. The training of the operators has caused
some issues such as incorrect advice and problems are still occurring
when the customer requires a third party to act on their behalf.
15. Pensioners do not like having to send
their valuable documents through the post to validate their telephone
claims and some customers do not pursue their claims due to this
reason. There have been numerous customers whose documents have
been lost or that they have had to send them in several times.
DEVELOPMENT OF
LOCALLY BASED
SERVICES
16. Local Authorities feel that services
need to reflect their local community and that it is vital that
this freedom to deliver services in the best possible way is decided
by local users.
17. Central government needs to work with
local government to maximise efficiencies delivering services
in an appropriate manner with appropriate data sharing.
18. The various service models need to be
evaluated with good practices being shared appropriately within
forums such as the LGA Action Learning Sets.
EXPERIENCE OF
CLAIMING PENSION
CREDIT
19. Some pensioners refuse to claim any
benefit that is means tested for a variety of reasons and may
lose out on Pension Credit and associated benefits continuing
to live in poverty.
20. The advertising campaign has raised
the expectations of pensioners that there will be a `reward' for
making provision for their old age. Clearly this applies to only
certain pensioners and some applicants with higher levels of capital
and superannuation have been disappointed.
21. Many customers enjoy a face-to-face
interview at a prearranged date and time in the privacy of their
homes. This allows them to have a third party present to give
them appropriate support.
22. The claim forms are very long and include
questions on benefits that are already being paid by the DWP.
23. New pensioners do not automatically
receive a claim form and there is no additional section within
the Retirement Pension claim form such as there is in the Job
Seekers Allowance claim pack.
24. Problems have occurred in tracking claims
when processing work is moved around the country at times of pension
centres pressures.
Experience of Direct Payments
25. The DWP have worked with the LGA to
try and minimise problems. Special arrangements have been made
for corporate account holders to make the transition as easily
as possible.
26. The problem of identifying the customer's
benefits is an issue with some bank statements.
27. There are concerns regarding the effectiveness
for replacing missing payments and national guidance.
28. Many customers value the role that their
local Post Office plays within their local community and have
real concerns about a growing number of closures resulting in
lengthy journeys to obtain cash and growing social exclusion.
Carol Habberfield
2004
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