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Basic pension
Max. income to get guarantee credit
Max. income to get savings credit
Aged 60-64
Credit+ Total
£50.00 £52.10 £102.10
£60.00 £42.10 £102.10
£70.00 £32.10 £102.10
£80.00 £22.10 £102.10
£90.00 £12.10 £102.10
£100.00 £2.10 £102.10
£110.00 £0.00 £110.00
£120.00 £0.00 £120.00
£130.00 £0.00 £130.00
£138.83 £0.00 £138.83

Aged 65 or over
Credit++ Total
£50.00 £52.10 £102.10
£60.00 £42.10 £102.10
£70.00 £32.10 £102.10
£80.00 £23.63 £103.63
£90.00 £19.63 £109.63
£100.00 £15.63 £115.63
£110.00 £11.63 £121.63
£120.00 £7.63 £127.63
£130.00 £3.63 £133.63
£138.83 £0.10 £138.93
Basic pension
Max. income to get guarantee credit
Max. income to get savings credit
Aged 60-64**
Credit+ Total
£90.00 £65.80 £155.80
£100.00 £55.80 £155.80
£110.00 £45.80 £155.80
£125.00 £30.80 £155.80
£140.00 £15.80 £155.80
£155.00 £0.80 £155.80
£170.00 £0.00 £170.00
£180.00 £0.00 £180.00
£190.00 £0.00 £190.00
£203.55 £0.00 £203.55

Aged 65 or over**
Credit++ Total
£90.00 £65.80 £155.80
£100.00 £55.80 £155.80
£110.00 £45.80 £155.80
£125.00 £31.52 £156.52
£140.00 £25.52 £165.52
£155.00 £19.52 £174.52
£170.00 £13.52 £183.52
£180.00 £9.52 £189.52
£190.00 £5.52 £195.52
£203.55 £0.10 £203.65

* or man and woman living as a couple

** age of older partner

† including standard income from capital. The first £5 (single) or £10 (couple) of earnings is not counted.

+ Guarantee credit only

++ Guarantee and savings credit

Pensioners' Rights
Change to Pensions from October 2003

Many people believed that changes in the pension system was going to mean that from October 2003 that the basic pension would become means tested. There was no need to worry, it didn't. The Government states that it is committed to the state pension being paid in full to everyone who has paid sufficient National Insurance contributions. However, from October 2003 there is an additional benefit called Pension Credit, which will be means tested. It is estimated that over half of pensioners will be eligible to claim it.

Pension Credit is a extension of the existing 'Minimum Income Guarantee' or MIG whereby people aged 60 plus can claim extra money to bring their weekly income up to £102.10 for a single person and £155.80 for a couple (rates valid from the 7th of April).

MIG didn't differentiate between someone who has saved for retirement and someone who hasn't. Someone who has put nothing aside get their income topped up to £102.10 under MIG while someone who has a personal pension of £20 a week was also only allowed a top-up to a maximum of £102.10!!!

Previously the argument was, 'what's the point of saving?' All that happens is that you get penalised.

Pension Credit aims to address this unfairness by giving extra money to people who have saved up or who continue to work after 65. It will benefit everyone over 65 who have a maximum of up to £138.83 and couples with an income up to £203.55. Higher amounts will be allowed for carers and people with severe disabilities.

Pension Credit

The new benefit began on the 6th of October 2003 and there are two parts: The first is called 'Guarantee Credit' and is identical to MIG in that its intended to make your income up to £102.10 for a single person and £155.80 for a married couple (or a man or woman living as a couple - same sex couples are treated as single for the purpose of this benefit), only one of whom has to be over 60.

The second part is called 'Savings Credit' and is payable to anyone aged 65 or older who has additional income beyond the basic state pension.

This extra income can be from:

Single Person

The Savings Credit will make up a single person's weekly income to £102.10 plus 60p for every pound of extra income over £77.45 to the maximum ceiling of £138.83.

Stephen is 66 and lives alone. His income is £87.45 a week ~ partly from his state pension (£77.45) and partly from a works pension. Stephen receives £10 more than the state pension. Guarantee Credit will make his income up to £102.10 while Savings Credit pays an additional 60p on the £10 works pension adding an additional £6. From October Stephen would be entitled to receive £108.10 a week (£6 more than he would receive currently).

Maximum total earnings under Pension Credit for a single person is £138.83 a week and is NOT paid to someone under 65 even if they retired at 60. A woman retiring at 60 is entitled to have her pension topped up under Guarantee Credit to a maximum of £102.10 but will not receive Savings Credit until she is 65.

Married Couples

Couples receiving a weekly income of above £123.80 a week are entitled to Savings Credit (this is the amount of state pension paid to a couple where both have paid on his National Insurance Contributions). Pensions Credit will make the couple's income up to £155.80 plus 60p for every pound of income over £123.80 up to a maximum of £203.55 a week.

Stephen and Pauline are in their late sixties. Their income at present is £173.80, which is £50 higher than the basic state pension for a couple of £123.80. Guarantee Credit will make up their income to £155.80 plus Savings Credit means they get an additional 60p in the pound for their savings of £50 a week (an additional £30 a week on top) making their weekly income up to £185.80. Prior to October this couple would receive nothing.

Capital Savings

Referred to as Capital it covers both cash and convertible investments. Capital of up to £6,000 will be ignored completely while capital beyond £6,000 is converted into ‘notional income’ regardless of how much income it actually generates. This is calculated as providing an assumed income of £1 a week for the initial £6,000 and a further £1 a week for every £500 savings. This ‘notional income’ is then added to any other income before Pension Credit is worked out.

The previous limit on capital (£12,000) will go so even people with healthy savings may still be eligible for Pension benefit.

Pauline, a single pensioner with £15,000 of savings in the bank is assumed to have an extra £18 a week income when it comes to calculating her Pension Credit.


Pension Credit is worked out on a person’s Gross Income (before tax is deducted). The credit is itself tax-free but you may have to pay tax on your other income.

Rent and Council Tax

From the 6th of October people 65 or older will receive additional help with rent and rates.

For a single person with an income of £116.90 a week or less it is likely that your rant and/or Council tax will be paid in full. For a couple that figure will be a £175 a week.

Everyone over 65 who currently receives a rent or Council tax reduction will get a larger reduction after October. Most single people will get an extra £150 a year off their Council Tax and if they pay rent and extra £9.50 a week reduction.

Couples will receive approximately £200 off their Council tax and an extra £12.50 off their rent. From October the new rules about capital will also apply.

Claim it!!!

The problem with this of course is that it’s NOT automatic - you have to claim it. Means-tested benefits are frequently NOT claimed – currently about ¾ of a million people over 60 COULD claim Minimum Income Guarantee but don’t while over a million fail to apply for help with rent and/or Council Tax.

It’s vital that you claim these benefits: to find out whether or not you will be eligible to MIG call 0800 0281111 From April that is also the number to call for applications for Pension Credit.

You can also find out more from your local Benefits Agency or by going to


Once assessed your Pension Credit will continue for five years without you having to inform the DWP of changes to income or savings, however if either drop significantly you can apply for reassessment at any time.