The latest release from the Department for Work and Pensions (DWP) into State Pension underpayment errors shows that between January 2021 and February 2023, the administration exercise identified 46,716 cases owed a total of £300.1 million. The previous update issued in November 2022 indicated that 31,817 underpayments had been identified and £209.3 million repaid to claimants.
A new progress update is due to be published on May 11, however, it is estimated that as many as 237,000 pensioners have been underpaid around £1.46 billion. The issue largely affects women retiring under the old State Pension system when many did not receive the State Pension payment they were entitled to under their husband’s National Insurance record.
Other women did not get uplifts to their weekly State Pension payments that they were entitled to when their husbands died. But, Helen Morrissey, head of retirement analysis at Hargreaves Lansdown, warns that despite the progress identifying underpayments, the DWP has “a mountain still to climb”.
Commenting on the most recent figures, Ms Morrissey said: “DWP is making progress in dealing with State Pension underpayments but there’s a mountain still to climb. So far almost 47,000 underpayments have been identified with £300m being repaid.
“However, with estimates suggesting as many as 237,000 pensioners have been underpaid £1.46bn it is clear this is a situation that is not going to be resolved any time soon and in the meantime thousands of pensioners are getting less than what they are entitled to.”
She continued: “The issue mainly affects women retiring under the old State Pension system (Basic). Some were unaware of the problem but many who queried the issue with DWP over the years were told there was no issue with many enduring real financial hardship as a result.
“These women have been let down on a gigantic scale and need resolution as soon as possible.”
State Pension underpayment progress - February 2023
Payments made between January 2021 and February 2023 are listed below.
Married (Cat BL)
- Cases reviewed: 82,225
- Underpayments identified: 22,276
- Average arrears: £6,630
- Total amount repaid: £147.7 million
Widowed
- Cases reviewed: 54,150
- Underpayments identified: 9,928
- Average arrears: £11,521
- T otal amount repaid: £113.2 million
Over 80
- Cases reviewed: 37,163
- Underpayments identified: 14,512
- Average arrears: £2,710
- Total amount repaid: £39.3 million
Who may be due back payments for State Pension?
There are six particular groups strongly encouraged to contact the pension service to see if they could be entitled to more State Pension.
- Married women whose husband turned 65 before March 17, 2008 and who have never claimed an uplift to the 60% rate
- Widows whose pension was not increased when their husband died
- Widows whose pension is now correct, but who think they may have been underpaid while their late husband was still alive, particularly if he reached the age of 65 after March 17, 2008
- Over-80s who are receiving a basic State Pension of less than £80.45
- Widowers and heirs of married women , where the woman has now died but was underpaid state pension during her lifetime
- Divorced women , particularly those who divorced after retirement, to check that they are benefiting from the contributions of their ex-husband
You can also find full guidance on transferring Basic State Pension payments on GOv.UK here.
How to check if you are affected or make a claim
A phone call to the pension service is the quickest way to find out if you are eligible for a State Pension refund.
The best number to call is 0800 731 0469 but full contact details can be found on the Gov.uk website here.
Earlier this year, a DWP spokesperson said: “The action we are taking now will correct historical underpayments made by successive governments. We are fully committed to addressing these errors, not identified under previous governments, as quickly as possible.
“We have set up a dedicated team and devoted significant resources towards completing this, with further resources being allocated throughout 2023 to ensure pensioners receive the support to which they’re entitled.”
To keep up to date with the latest State Pension news, join our Money Saving Scotland Facebook page here, follow us on Twitter @Record_Money, or subscribe to our newsletter which goes out Monday to Friday - sign up here.
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