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The take-up of multiple means-tested benefits by British pensioners. Evidence from the Family Resources Survey

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  • Ruth Hancock
  • Stephen Pudney
  • Geraldine Barker
  • Monica Hernandez
  • Holly Sutherland

Abstract

Non take-up of means-tested benefits among pensioners is of longstanding concern. It will assume increased importance from 2003 with the introduction of the new means-tested Pension Credit, which will subsume Income Support and to which about half of all pensioners are expected to be entitled. In this paper we use Family Resources Survey data spanning the period April 1997 to March 2000 to investigate patterns of take-up of the three main means-tested benefits to which pensioners may be entitled – Income Support (IS), Housing Benefit (HB) and Council Tax Benefit (CTB). We find that although 36% of pensioners in our sample are failing to claim their entitlements to at least one of these benefits, only 16% of non claimants are failing to claim amounts worth more than 10% of their income. The proportions by which claiming all entitlements would increase non- claimants’ incomes are more useful indicators than individual benefit take-up rates, of the effectiveness of means-tested benefits. In general take-up is high where entitlement is high. But there are exceptions to this which may reflect the claims process and/or a greater degree of social stigma associated with IS than with HB or CTB.

Suggested Citation

  • Ruth Hancock & Stephen Pudney & Geraldine Barker & Monica Hernandez & Holly Sutherland, 2003. "The take-up of multiple means-tested benefits by British pensioners. Evidence from the Family Resources Survey," Discussion Papers in Economics 03/7, Division of Economics, School of Business, University of Leicester.
    • Handle: RePEc:lec:leecon:03/7
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    1. Stephen Pudney & Monica Hernandez & Ruth Hancock, 2007. "The welfare cost of means-testing: pensioner participation in income support," Journal of Applied Econometrics, John Wiley & Sons, Ltd., vol. 22(3), pages 581-598.
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    Cited by:

    1. Bargain, Olivier & Immervoll, Herwig & Viitamäki, Heikki, 2007. "How Tight Are Safety-Nets in Nordic Countries? Evidence from Finnish Register Data," IZA Discussion Papers 3004, Institute of Labor Economics (IZA).
    2. Laurence, JACQUET, 2006. "Optimal disability assistance when fraud and stigma matter," Discussion Papers (ECON - Département des Sciences Economiques) 2006052, Université catholique de Louvain, Département des Sciences Economiques.
    3. Tomer Blumkin & Yoram Margalioth & Efraim Sadka, 2008. "The Role of Stigma in the Design of Welfare Programs," CESifo Working Paper Series 2305, CESifo.
    4. Anthony B. Atkinson & Chrysa Leventi & Brian Nolan & Holly Sutherland & Iva Tasseva, 2017. "Reducing poverty and inequality through tax-benefit reform and the minimum wage: the UK as a case-study," The Journal of Economic Inequality, Springer;Society for the Study of Economic Inequality, vol. 15(4), pages 303-323, December.
    5. Terracol, Antoine, 2009. "Guaranteed minimum income and unemployment duration in France," Labour Economics, Elsevier, vol. 16(2), pages 171-182, April.
    6. Miles Corak & Christine Lietz & Holly Sutherland, 2005. "The Impact of Tax and Transfer Systems on Children in the European Union," Papers inwopa05/30, Innocenti Working Papers.
    7. Olivier Bargain & Herwig Immervoll & Heikki Viitamäki, 2012. "No claim, no pain. Measuring the non-take-up of social assistance using register data," The Journal of Economic Inequality, Springer;Society for the Study of Economic Inequality, vol. 10(3), pages 375-395, September.
    8. Wiemers, Jürgen, 2015. "Endogenizing take-up of social assistance in a microsimulation model : a case study for Germany," IAB-Discussion Paper 201520, Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany].
    9. Olivier Bargain, 2009. "The distributional effects of tax-benefit policies under New Labour : a Shapley decomposition," Working Papers 200907, School of Economics, University College Dublin.
    10. Tomer Blumkin & Efraim Sadka & Yoram Margalioth, 2008. "The Role of Stigma in the Design of Welfare Programs," Working Papers 0806, Ben-Gurion University of the Negev, Department of Economics.
    11. Ewoudou, Jacques & Tsimpo, Clarence & Wodon, Quentin, 2009. "Stigma and the take-up of social programs," Policy Research Working Paper Series 4962, The World Bank.
    12. Blumkin, Tomer & Margalioth, Yoram & Sadka, Efraim, 2008. "The Role of Stigma in the Design of Welfare Programs," Foerder Institute for Economic Research Working Papers 275714, Tel-Aviv University > Foerder Institute for Economic Research.
    13. Michel, DE VROEY, 2006. "Getting Rid of Keynes ? A reflection on the history of macroeconomics," Discussion Papers (ECON - Département des Sciences Economiques) 2006051, Université catholique de Louvain, Département des Sciences Economiques.
    14. Jürgen Wiemers, 2015. "Endogenizing take-up of social assistance in a microsimulation model. A case study for Germany," International Journal of Microsimulation, International Microsimulation Association, vol. 8(2), pages 4-27.
    15. Kerstin Bruckmeier & Jürgen Wiemers, 2017. "Benefit take-up and labour supply incentives of interdependent means-tested benefit programmes for low-income households," EcoMod2017 10295, EcoMod.
    16. Irene Mosca & Robert E. Wright, 2018. "Effect of Retirement on Cognition: Evidence From the Irish Marriage Bar," Demography, Springer;Population Association of America (PAA), vol. 55(4), pages 1317-1341, August.

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    More about this item

    Keywords

    benefit take-up; pensions; means-testing; welfare participation;
    All these keywords.

    JEL classification:

    • D31 - Microeconomics - - Distribution - - - Personal Income and Wealth Distribution
    • H31 - Public Economics - - Fiscal Policies and Behavior of Economic Agents - - - Household
    • H55 - Public Economics - - National Government Expenditures and Related Policies - - - Social Security and Public Pensions
    • I38 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty - - - Government Programs; Provision and Effects of Welfare Programs

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