Eligible elderly missing out on non-contributory pensions

Many elderly people are unaware that they could be eligible for a non-contributory pension payment, even if they have savings of up to £44,000 (€55,870) per person. It is likely that a number of elderly people are not claiming the State pension which they are entitled to, according to the Department of Social, Community and Family Affairs.

One Family Money reader, Ms R from Antrim, wrote to enquire about entitlement to the non-contributory pension, specifically in relation to relatives of hers living in Wexford and Tipperary.

The two farmers in question are in their 70s and have told Ms R that they are not entitled to a pension. One lives on a small farm and has some savings, and the other lives on a larger farm and has a small income. It is true that the non-contributory pension is means-tested, but the Department increased the qualifying income and savings thresholds last October and Ms R's relatives may now qualify. The old age non-contributory pension is a means-tested payment for people aged 66 or over who do not qualify for a retirement pension or old-age contributory pension based on their social insurance record. The maximum payment for an individual is £85.50 per week and that will increase by £10 in April. More than 90,000 people are currently in receipt of the pension. So how do you go about finding out if you are eligible? To qualify for payment, a social welfare inspector will ask you for details of your means. They may do this at your local social welfare office or may call to your home. To set the ball rolling, you must complete an application form - OAP1 - which is available from post offices, social welfare offices or from the Pension Services Office. The main items which are counted as means are cash income, income from employment or self-employment, the value of any property you have apart from your home, and the value of any investments and savings. The annual value of any advantage you have from owning or leasing a farm is assessed as income. The yearly value is worked out by deducting any necessary expenses incurred from the gross income. If a person living with you pays you rent, this will not be counted as means if otherwise you would live alone. The non-contributory pension can be paid directly to your bank, building society or An Post savings account, or by a book of payable orders which can be cashed weekly at a chosen post office. There are additional weekly allowances payable to people who are living alone or aged over 80. Those who are awarded a non-contributory pension will automatically be sent a travel pass and may, under certain conditions, qualify for a fuel allowance, free television licence, free telephone rental allowance and medical card.