Charity Age Concern is calling for the government to take action in order to increase the number of people receiving pension credits.
A new report from the group, entitled Flagship or Flagging? has found that six out of ten low income pensioners are struggling to handle their finances.
The organisation is urging ministers to reform the system and introduce automated pension credit payments to ensure that most people receive them.
One in ten poor pensioners are being forced into debt by the rising cost of living and over half of them are cutting back on basic essentials as a form of debt management, the study claimed.
“Pension Credit has the potential to lift hundreds of thousands of pensioners out of poverty, but will remain more flagging than flagship without urgent action to reform the faltering benefits system,” remarked director general Gordon Lishman.
A recent survey from GE Money Home Lending showed that only one in four Brits feel their pension will cover their retirement.
By Jamie Price