The UK government is preparing to prohibit companies from charging pensioners fees to help them claim disability benefits, according to Work and Pensions Secretary Pat McFadden. The move targets "rogue" firms that have been criticized for exploiting vulnerable individuals, particularly the elderly, by charging substantial fees for assistance with Attendance Allowance claims.
McFadden has outlined plans for a crackdown following a significant increase in the number of claims for Attendance Allowance being processed through management firms. He stated in an article for the Daily Mail that some pensioners, some in their 80s, have been left distressed by their interactions with these companies, which can charge up to £1,300 annually. These fees can exceed 20 percent of the benefit amount, and in some instances, details have been submitted for claims without the claimant's knowledge, a practice McFadden described as potentially amounting to fraud.
"It is unacceptable that rogue companies are charging people significant fees for support they are entitled to," McFadden said. "Our actions will hold these companies to account and make sure people know that free, independent support is already available through trusted organisations. The welfare state exists to support those in need, including vulnerable pensioners. It's not there for private companies to profit from."
Under a proposed new code of conduct, firms will be forbidden from charging fees to submit claims on behalf of individuals. Government sources indicated that ministers have become increasingly concerned as claims management firms, which have long operated within the benefits system, appear to be specifically targeting vulnerable elderly people for profit. The number of Attendance Allowance applications submitted via these firms has risen fivefold in the past year, from hundreds to thousands.
Attendance Allowance is a benefit provided to pensioners who require personal care due to illness or disability. The weekly rates are £76.70 for those needing frequent daytime assistance and £114.60 for those requiring help both day and night. Ministers are prepared to introduce legislative changes to ban such fees if the firms do not adhere to the new code of conduct. Additionally, the government is funding an advertising campaign to inform the public about the availability of free, independent benefits advice services.