Thousands of Tower Hamlets pensioners who are no longer eligible for the Winter Fuel Payment will be entitled to a one-off £175 lump sum from the council to help cover their bills.

Almost 5,000 eligible pensioners living in the borough will receive the £175 payment, which is being partly funded by the government’s Household Support Fund (HSF), in December.

Tower Hamlets mayor Lutfur Rahman gave an update on the scheme during a cabinet meeting on October 16.

Mr Rahman said: “At our last full council meeting, this administration pledged to look to establish a Winter Fuel Payment to plug the gap left by the recent cut that would have seen nearly 5,000 residents lose out on much-needed support with their energy bills.

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“I am pleased to announce that we have been able to locate funds. Officers have clearly helped us and we are very grateful to them to provide each of the nearly 5,000 eligible pensioners with a £175 payment towards their bills this winter – a £900,000 total investment in the elderly of our borough.”

Following government changes that were announced in July, now only around 1.5 million people will be eligible for the Winter Fuel Payment, compared to the 11.4 million people who would have received it when the payment was available for anyone over the age of 66 – regardless of their financial situation.

The payment, worth £200 or £300 depending on when someone is born, is now only available for those on Pension Credit or those who receive other means-tested benefits.

The council is working on increasing the uptake of an estimated 4,500 residents who are eligible for the Pension Credit but are n’t currently claiming.

Mr Rahman said the council will be launching a full-scale, multi-lingual campaign aimed at supporting individuals to sign up for Pension Credit, which closes for applications on December 21.

He said in an official statement: “Making the Winter Fuel Payment means-tested will have a detrimental effect on pensioners who are already facing the rising costs of energy bills.

“This creates a risk that pensioners will not turn their heating on for fear of not being able to pay the bills, which is wrong. This is why we are stepping in and providing a £175 safety net for those who will be missing out.”

The council estimates there are around 109,898 missed benefits claims in Tower Hamlets, adding up to more than £110million in unclaimed support.