Andrew Smith

The government has been criticised for the slow take-up of the new pension credit.

Figures published on Tuesday revealed that 1.97 million households now receive the new benefits, and of those around 1.4 million individual pensioners are now receiving a bigger income as a result.

Ministers claimed that of the 1.8 million households that received the previous Minimum Income Guarantee, over two thirds are an average £6.65 a week better off as a result of the new regime, while a further 93,000 households that were not eligible under the old system now received an average extra £9.50 a week.

"I am pleased that the pension credit has got off to a good start, with already 1.4 million pensioners better off than they were under the old system," said work and pensions secretary Andrew Smith.

"It's also good that, for the first time, people who saved for their retirement are being rewarded.

"It's straightforward to apply for pension credit and we are getting a lot of positive comments on how helpful people have found the Pension Service."

But shadow work and pensions secretary David Willetts described the means-testing behind the pensions credit as "complex" and "intrusive".

"These figures reveal that only 82,000 pensioner households have signed up for pension credit in the last month, despite the millions spent on advertising," he said.

"Awareness of the pension credit is extremely low, with over three-quarters of the sample of pensioners used in a recent Department of Work and Pensions research report claiming to have no knowledge of the pension credit.

"In the seven months since people could apply for benefit only an extra 93,000 out of a target 1.2 million households are getting the benefit. At this rate it will take another six and a half years before the government will even hit their target."

The Liberal Democrats argued that the "eye wateringly complex system" of the pension credit had meant that less than half of pensioners eligible for the extra cash were actually receiving it.

"With the pension credit the government has created an eye wateringly complex system for pensions. It comes as no surprise that large numbers are failing to claim what they are entitled to," said pensions spokesman Steve Webb.

"This failure comes right after the government has been spinning the tax credits as a great success. The government must stop congratulating itself for failure.

"The only guaranteed way to get extra money to the poorest pensioners is by boosting the inadequate state pension."