State Pension UK: Women could receive £100million back from DWP after underpayment

State Pension UK: Women could receive £100million back from DWP after underpayment

State Pension payments are a key source of income, and many think about what they will receive before they retire. However, new analysis has uncovered the Department for Work and Pensions (DWP), responsible for the sum, may need to pay out due to underpaid state pensions. The government department was recently quizzed on instances where women may not be receiving the state pension to which they are entitled.

This was following an investigation undertaken by Lane Clark Peacock (LCP) partner Sir Steve Webb, who is also the former minister of state for pensions. 

The questions related to rules under the old state pension system, where women were permitted to claim a state pension uplift based on the National Insurance record of their husband or ex-husband.

Older women, who were born before April 6, 1953, were found to be able to claim a boost to their entitlement in some circumstances.

Although in most instances, women have received what they are entitled to, there have been a number of instances where discrepancies have come to light.

READ MORE: Pension UK: Women facing massive retirement savings gap – take action

“The challenge at the moment for us is that we need to work through each of these cases. They are quite complex calculations.”

However, Mr Schofield also said the work of the DWP in terms of checking records was still ongoing.

As such, there could be more women who are uncovered as needing to be in receipt of additional state pension sums, with LCP analysis stating tens of thousands could be affected.

The consulting actuary firm stated that when based on average lump sum repayments of just under £10,000, a final bill could rack up to over £100million for the DWP. 

“But it has become increasingly clear that the DWP’s trawl of its own records is uncovering a can of worms, and the final bill seems set to be over £100million. 

“Many of these women have been underpaid for a decade or more, and the situation needs to be put right as a matter of urgency.”

Sir Steve also set up a petition to Parliament entitled ‘Review state pension entitlements for all women who may have been underpaid’.

As of this morning, the petition gained over 10,000 signatures, which triggers a government response as a result. 

A DWP spokesperson told Express.co.uk: “We are aware of a number of cases where individuals have been underpaid State Pension. We corrected our records and reimbursed those affected as soon as errors were identified.

“We are checking for further cases, and if any are found awards will also be reviewed and any arrears paid.”

Published at Tue, 03 Nov 2020 06:43:00 +0000