The government is to reopen its controversial decision not to award compensation to up to 3.8 million women affected by changes to the state pension age, following the emergence of new evidence.
The work and pensions secretary Pat McFadden told the Commons that ministers would look again at denying compensation to the women born in the 1950s, whose state pension age was raised so it would be equal to men.
He said “evidence” which was not shown to his predecessor Liz Kendall when she made the decision last December had since emerged and had to be considered.
Labour came under fire after it refused compensation despite a recommendation by the Parliamentary and Health Service Ombudsman (PHSO) that the women should be paid up to £2,950 each, at a total potential cost of £10.5bn, because poor communication meant they had lost out on the chance to properly plan for their retirement.
Ministers were accused of presiding over a “day of shame” for the government after they announced that up to 3.8 million women affected by changes to the state pension age, from 60 to 65, would not receive compensation.
The then work and pensions secretary, Ms Kendall, rejected calls for individuals affected to be awarded between £1,000 and £2,950 each, while claiming she understood their unhappiness.
The party had backed the Waspi women’s campaign when Jeremy Corbyn was leader.
The latest move in the saga comes after court proceedings led to the rediscovery of a 2007 Department for Work and Pensions (DWP) evaluation. The document led to a halt in automatic pension forecast letters being sent out.
Angela Madden, the chair of Women Against State Pension Inequality (Waspi), said the decision was a “major step forward”.
She said: “For 10 years we have been fighting for compensation. The government have fought us tooth and nail every step of the way. Today’s announcement is a major step forward. We are now seeking legal advice as to what this means for our judicial review.
“The government now knows it got it wrong and we are pleased they are now trying to do it properly. We hope they also try to do it quickly because every 13 minutes a Waspi woman dies. The only correct thing to do is to immediately compensate the 3.6 million Waspi women who have already waited too long for justice.”
However, Mr McFadden cautioned that reconsidering the decision did not mean ministers would award the women compensation.
He told MPs: “Retaking this decision should not be taken as an indication that the government will necessarily decide that it should award financial redress.
“The work will begin immediately and I will update the House on the decision as soon as a conclusion is reached.”
Last year, the PHSO released the findings of its five-year investigation into the issue and, in a damning assessment of the DWP handling of the issue, warned of “maladministration”.
The PHSO report accepted that the DWP’s poor communication caused some women to lose “opportunities to make informed decisions”, although it made clear it did not believe it led to “direct financial loss”.
However, it ruled that affected women were due compensation of typically £1,000 to £2,950 each.
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