State Pension  

Majority of carers miss out on pension credits

Majority of carers miss out on pension credits

More than 90 per cent of carers eligible for credit towards their state pension are not receiving it, according to analysis from Quilter.

As first reported by FTAdviser’s sister publication Financial Times, a freedom of information request by the financial services company revealed just 17,388 people were receiving carer’s credit at the end of 2018.

But according to an estimate from the department for Work and Pensions in 2015, about 200,000 carers are eligible for the benefit, with women making up a substantial proportion.

Carer's credit, which counts towards a person’s state pension entitlement, is available to those who do not get a carer’s allowance but are caring for someone.

The individual must be between 16 and state pension age and look after one or more people at least 20 hours a week. 

The credit could be worth £244 a year in retirement, or £1,220 over five years, the firm stated.

According to Jon Greer, head of retirement policy at Quilter, unpaid carers "save the UK an astonishing £132bn a year, a figure that will most certainly grow as our society ages".

He said: "However, these people sometimes don’t even recognise themselves as carers or the extent of the sacrifice they are making.

"Thinking of their own long term financial wellbeing is crucial and the state pension is a big part of that, particularly as it’s money they rightfully deserve.

"The government has all the tools to ensure carers aren’t unnecessarily disadvantaged, but at the moment they aren’t being used.

"A campaign is needed and the government should investigate what literature or forms that carers receive where they can highlight the need to apply for credits.

"Given the low take-up so far, government also need to extend the length of time people can retrospectively claim credits as at the moment it’s merely to the beginning of the previous tax year."

Analysis from Think Tank Demos published in July revealed the total value of informal care is nearly as large as the UK’s entire health spending, at £144bn, and stands at nearly eight times total spending on adult social care at £18bn.

A department for Work and Pensions spokesperson said: "We want people who are not working because of caring responsibilities to receive their full entitlement to state pension.

"There are a number of ways carers can ensure they do this. Claiming carer’s credits is just one, and we have worked with Carers UK and run several campaigns to let people know about them."

maria.espadinha@ft.com