Pension Credit: assessed income periods

Pension Credit – the main means-tested benefit for pensioners – was introduced in October 2003. Awards to people aged over 65 may include an “assessed income period” (AIP) of up to five years, during which some changes in circumstances do not have to be reported. People aged 75 will often be given an indefinite AIP, and those whose AIP runs out after they reach 80 will not normally need to be reassessed. The AIP ends early in certain circumstances, for example, if the claimant starts or stops being a member of a couple, goes into a care home permanently or is no longer entitled to Pension Credit. In addition, they can request a reassessment of their claim if their income falls.

The Labour Government’s intention, with the introduction of AIPs, was to make means-testing less intrusive for pensioners, by no longer requiring them to report changes of circumstance to the Pension Service on a weekly basis. It was also justified by the fact that pensioners’ circumstances tended to change less often than those of working age people.

The current Government announced its intention to abolish AIPs in the Spending Review on 26 June 2013. It has tabled an amendment to the Pensions Bill 2013/14 in advance of Report Stage on 29 October to provide for the abolition of AIPs from April 2016.