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Thanks for all the responses. I can now give an update on this and it's good news.
I drove over and took him and friend to the Post Office to draw outstanding pension and ask for advice. It turns out that despite his insistence that he was just given his pension in cash, he does after all have a card which his pension is put onto and he draws it straight out at the PO counter as cash. (I'm wondering if post office staff usually sort his PIN out for him as they clearly know him well and seemed to help him this time too.)
Sorry if I gave wrong info last time- he was so insistent he was just given cash with no card.
Anyway, we then asked about appointing someone to collect it for him in future for a while and it was as simple as them giving us a form to fill in there and then (the form Fionska mentioned I think) and his friend had to show some minimal ID. They took the completed form back to send off and said he would soon have a card to draw money out for Uncle when needed. That has its own risks I suppose but we have to trust him as I cannot do it every time.
We then all went to bank and uncle paid most of it in. Without prompting the bank teller tried to raise again the idea of changing to pension payments by bank transfer but he made it clear again he won't budge on that.
But the overall outcome is good enough for me. Thanks all.