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The Work and Pensions Committee has recommended a temporary Universal Credit increase for eligible people in the year before State Pension age. The proposal has not been approved, and the DWP has not announced any new payment rate.
MPs are urging the Government to provide extra financial help to 66-year-olds who may be left waiting longer for their State Pension as the qualifying age gradually rises to 67.
The cross-party Work and Pensions Committee wants ministers to consult on a temporary Universal Credit increase and aims to see support introduced by the end of 2026. The recommendation is designed for people who cannot continue working because of poor health, disability, caring responsibilities, redundancy or years spent in physically demanding jobs.
No benefit increase has yet been confirmed. The committee can recommend policy changes, but only the Government can approve new payment rates, eligibility rules and funding.
Why the pension-age change creates a financial gap
The phased rise above 66 began in April 2026 and is due to reach 67 by April 2028. A person’s exact State Pension date depends on their date of birth, so some will wait only a few months beyond 66 while others will not qualify until their 67th birthday.
The official State Pension age timetable explains when the new dates apply.
MPs are concerned that people who leave work before their pension starts may have to survive for longer on working-age benefits. A single Universal Credit claimant aged 25 or over receives a standard allowance of around £425 a month before additional elements, means-testing or deductions are applied.
Pension Credit does not normally become available until State Pension age, leaving some people without access to pension-age support during the transition. They may instead use savings or private pension funds earlier than planned, weakening their finances later in retirement.
MPs warn the impact will not be equal
Committee chair Debbie Abrahams said older people should not have to choose between continuing in unsuitable work while unwell and remaining in poverty while waiting for their pension.
The committee said more than half of people are no longer in paid employment by their mid-60s. Older jobseekers can face age discrimination, limited retraining opportunities and fewer suitable vacancies, particularly when long-term health conditions restrict the type of work they can do.
The report also highlighted geographical inequality. Poor health and disability are more common in deprived areas, where employment opportunities may be weaker and life expectancy shorter. That means some people could wait longer for the State Pension while receiving it for fewer years.
MPs pointed to the previous rise from 65 to 66 as a warning. According to the committee, absolute poverty among 65-year-olds more than doubled after that change.
How the proposed Universal Credit boost could work
The committee recommends increasing Universal Credit for eligible recipients during the final year before State Pension age. It favours using the existing system because support could potentially be delivered faster than through a newly created benefit.
No proposed payment amount has been published. MPs described the idea as a modest increase and acknowledged that ministers would need to consider costs and work incentives.
However, the committee argued that people who have already left the labour market close to retirement are unlikely to return simply because benefits remain low. Health, limited job opportunities and caring duties are often the main barriers.
Current allowances and related changes are explained in this guide to the latest Universal Credit payment rates.
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The Department for Work and Pensions said it would consider the committee’s findings. It noted that only 0.02% of the Universal Credit caseload was aged 65 or 66 in February 2026 and pointed to existing means-tested and disability-related benefits.
Age UK welcomed the recommendation, while the Centre for Ageing Better said longer-term reform should connect pensions, employment, health, skills and benefits rather than treating each issue separately.
People approaching retirement should check their exact State Pension date and review whether they qualify for existing help. There is currently no separate application for the proposed boost because the policy has not been introduced.
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