More than 100 thousand pensioners will lose winter assistance: who will be affected by cuts.

According to The Sun: More than 100,000 pensioners may lose their winter fuel payments next year, warned a former pensions minister.

The rise in state pensions and other payments that will occur next April will mean that more than 100,000 people will be unable to receive winter assistance, noted Sir Steve Webb.

According to current rules, pensioners can receive a winter fuel payment of up to £300 if their annual income does not exceed £35,000.

However, in June, pensions minister Torsten Bell confirmed that the government has no plans to increase the threshold of £35,000 this year.

As a result, more than 100,000 pensioners who received winter payments this year may find their income exceeds the specified threshold, leading to a loss of financial assistance.

The number of those losing such assistance is expected to rise throughout this parliament and may reach half a million by 2029.

This situation will be disappointing news for millions of pensioners who were deprived of winter payments last year but were eligible for them this year.

Steve Webb, a partner at LCP, described this data as 'roller coasters', making it difficult for people to plan their finances for retirement.

He noted: 'Given that the increases linked to inflation are merely trying to maintain people's living standards, it is hard to say that they are making people 'better off' and thus less deserving of winter payments.'

He also added that, since the threshold is likely to remain unchanged in the coming years, this will lead to a gradual exclusion of an increasing number of people from receiving assistance.

Last year, The Sun launched the Winter Fuel SOS campaign to support thousands of pensioners facing difficulties due to rising energy costs.

How does the winter fuel payment work?

The winter fuel payment is a one-time assistance provided to pensioners to cover energy costs during the cold months.

These payments can be up to £300, depending on the recipient's date of birth.

Pensioners born between September 22, 1945, and September 21, 1959, will receive a payment of £200, while those born before September 22, 1945, will receive £300.

Most eligible individuals will receive their payments automatically.

However, if your annual income exceeds £35,000, HM Revenue and Customs will reclaim this payment.

If you are eligible for the payment, you will receive a letter in October or November with information about the amount of assistance.

How will this affect pensioners?

For example, a pensioner with an income of £33,600 may lose their winter payment next year due to pension increases related to inflation.

If they are eligible for the full new state pension, they will receive £11,973 this year.

With the state pension expected to rise by 4.7%, their payment next year will be £12,535, which is £562 more.

Additionally, if they have a corporate pension of £21,627 this year, which will increase by 4% according to inflation, then next year it will be £22,492.

Thus, the total income from both pensions will increase by £1,427, raising their annual income to £35,027.

As a result, they will find themselves only £27 above the winter payment threshold, which could lead to a loss of up to £300 a year.

How to avoid this?

Before taking any actions, it is advisable to seek advice. Citizens Advice can help you check if you are receiving the correct social payments.

If you are over 55, you are entitled to a free consultation to discuss your retirement plans with Pension Wise.

One way to avoid this situation is to reduce the amount you withdraw from your private pension.

This means you should withdraw money from your pension through a process known as 'drawing down'.

This approach means that you withdraw part of your pension savings each year, leaving the rest invested.

You may want to limit the amount you take from your private pension to ensure your total income does not exceed the winter payment threshold.

However, before making such decisions, consult a financial advisor to ensure you have enough funds to cover all expenses.

Given the rising prices of food, fuel, and energy this year, you will need more money to buy the same amount of goods.

You can also reduce your income from other sources.

For example, if you receive a state pension but work part-time, consider reducing the number of hours you work.

Again, it is important to think about whether you can cover all your expenses before making such a decision.

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