Government restores winter fuel payment for around nine million pensioners after U-turn
Payments in England and Wales will be means-tested to households with annual incomes up to £35,000 and paid automatically in winter 2025; amounts set at £200–£300.
The government has reversed a 2024 decision and will restore winter fuel payments to roughly nine million pensioners in England and Wales, after ministers announced a U-turn in June. The revived scheme will be means-tested so that households with an annual income of £35,000 or less will be eligible, with payments made automatically in winter 2025.
The payment will be worth £200 for individuals of state pension age up to 79 and £300 for those aged 80 and over. The Department for Work and Pensions (DWP) said the money is normally paid in November or December. The government said the change will mean about 75% of pensioners in England and Wales receive the winter fuel payment next winter, and that the rules will also be changed again in Scotland.
The U-turn followed widespread criticism of a July 2024 move that restricted payments to people claiming pension credit or other specified means-tested benefits. That earlier decision meant 9.3 million fewer pensioners received the payment in winter 2024–25 than in previous years. Charities, trade unions and MPs warned that many older people on modest incomes who do not claim pension credit would be left without help with energy bills, and some Labour MPs said the policy contributed to poor electoral performance in local contests.
Chancellor Nadhim Zahawi’s successor in the relevant ministerial role announced the reversal in June and framed the restored payments as targeted support. "We will continue to means-test this payment so that it is targeted and fair, rather than restoring eligibility to everyone including the wealthiest," the minister said. The government has not given a detailed timetable for publishing full operational guidance, but has said payments will be processed automatically using existing DWP records.
Under the revised rules, the DWP will cross-reference benefits and tax data to determine household eligibility. Information used will include records of state pension payments, pension credit and Attendance Allowance, matched with the household address to establish who lives in each property. In couples where both are eligible and under 80, the standard payment will be split, meaning each person would effectively receive £100 if the household is entitled to the £200 rate.
If a household contains two people above state pension age but one has a taxable annual income above £35,000 and the other below that threshold, only the lower-income pensioner will receive half the payment; the higher-income pensioner will not receive anything. The government also said roughly two million people above state pension age with taxable yearly incomes above £35,000 will receive the winter fuel payment but will have it reclaimed through increased tax bills.
The earlier linkage to pension credit was controversial because pension credit is a gateway to several other forms of support — a top-up to state pension entitlements that can also unlock reductions in council tax, a free TV licence for those over 75 in some cases, and help with NHS costs. The DWP and outside organisations have long urged eligible pensioners to claim pension credit, but take-up remains incomplete. More than half a million people who qualify for pension credit do not claim it, according to government-backed estimates.
Pension credit eligibility is determined by weekly income thresholds and savings. Under current rules, a single person above state pension age could be eligible for pension credit if their weekly income is less than £218.15, and a couple if their combined weekly income is less than £332.95, though savings are also taken into account. Independent online calculators and guidance are available from organisations such as MoneyHelper, Policy in Practice, Entitledto and Turn2us.
Payments for Northern Ireland and Scotland are handled under devolved arrangements and differ from England and Wales. The government has said the rules in Scotland will be amended again, but it has not published full details of those changes. Ministers have indicated that the objective is to retain targeting so help goes to those with lower incomes while excluding wealthier pensioners.
The restored winter fuel payment aims to address concerns about older people facing higher energy costs through the cold months while maintaining a means-tested approach to avoid universal payments to wealthier households. The DWP expects the payments to be distributed automatically in late 2025, following the matching of benefit and tax records to confirm household eligibility.