A fifth of older households who are ineligible for the council tax rebate to offset energy price rises are already living in poverty or hardship, a charity has warned.

Age UK has urged the Chancellor to announce more financial support for older people on low and modest incomes, ahead of Wednesday’s spring statement.

It found that 21% of older households who will not receive the £150 council tax rebate because their home is not in band A to D are living in poverty or just above the poverty line, or are in receipt of income-related benefits.

There are 4.3 million households in England who will not be eligible for the rebate because they live in properties banded E to H, of which 2.1 million include at least one person aged 60 and over.

Age UK said the figures highlighted the “cracks” in Government support for older people living in poverty or financial hardship “who happen to live in the wrong kind of homes”.

It warned that basics such as food and heating were fast becoming unaffordable for many pensioners living on a low fixed income, even before energy bills soar from April 1.

Age UK said it was “deeply concerned” that the support package announced by the Government last month fell “badly short of what is needed to protect older people on low and modest incomes from unaffordable energy bills and other rising prices”.

It is calling for a targeted package of support which mitigates the whole 54% price cap rise this April for lower income households, direct payments of up to £500 to people who are eligible for the cold weather payment and a doubling of the discretionary fund to £288 million to support those missing out on the council tax rebate.

Age UK charity director Caroline Abrahams said: “It was already clear that the support announced by the Government last month was insufficient to protect older people on low and modest incomes from the impact of inflationary price rises.

“Now, deepening our concerns, our new analysis shows that one in five of the older population who are already hard-pressed are set to miss out on the £150 council tax rebate.

“As things stand, at Age UK we simply cannot see how older people who have no other sources of income besides their state pension and benefits will be able to pay the higher prices they face.

“The spring statement is the Chancellor’s opportunity to demonstrate he understands how inflation is overwhelming the best efforts of older people on low incomes to stay afloat, and is willing to send them a life raft.

“We are hearing from many older people who never dreamed that they would find themselves in such deep financial trouble at this stage of their lives, and who are frankly terrified about the bad news on prices the rest of the year may bring.

“It’s an absolute nightmare for them.”

Opinium questioned 1,280 UK adults aged 65 and over between January 14-18.