Millions of UK households are collectively missing out on at least £19bn a year in welfare benefits they are entitled to, at a time when many are turning to food banks or running up debt amid rising living costs, according to new estimates. The study by consultancy Policy in Practice found that lower-income households are failing to claim benefits and cash support, with some families forgoing as much as £4,000 a year.
The analysis attributes the high level of unclaimed support to the sheer complexity of the benefits system, a lack of public awareness, and fear of being perceived by others as “benefit scroungers”. It estimates that 1.3 million households do not claim universal credit, leaving £7.5bn unclaimed each year, while nearly 3 million eligible families do not claim council tax support worth £2.9bn, and 5 million households miss out on almost £2bn of help with water, energy and broadband bills.
Benefits advisers said they typically secured additional payments of £10 to £20 a week for clients, which nonetheless had a transformative effect. “It can mean the family can eat properly, put the heating on, get the bus, take the children swimming – all the things we take for granted,” said one adviser. Larger sums were not unusual: a pensioner couple in Kent living on £280 a week were helped to secure an extra £222 a week in pension credit, worth £11,500 a year, while a Coventry pensioner on £55 a week became eligible for an extra £138 a week.
Pensioners are more likely not to apply for benefits on the grounds that they perceive handouts as shameful, according to advisers. An estimated 850,000 pensioner households fail to claim £1.8bn annually in pension credit, the study found. Policy in Practice urged the government to commit to positive messaging about benefits, noting that “the stigma and shame attached to claiming benefits is a major factor driving no-take-up among those who are eligible but who choose not to engage with the benefit system at all”.
The study argued that the social security system has become hugely complex, requiring multiple application mechanisms across different organisations, with households potentially needing to make six or seven separate applications. Daphne Hall, vice-chair of the National Association of Welfare Rights Advisers, said claimants needed high levels of confidence, persistence, patience and determination to negotiate systems that put administrative and psychological barriers in the way. The £19bn figure does not include disability benefits such as personal independence payment and attendance allowance.
