Since 2021, the Department for Work and Pensions (DWP) has been working diligently to identify and correct underpayments of state pensions that have impacted thousands of pensioners.
As of the latest update, a total of 130,948 pensioners have been identified as victims of underpayment due to errors in the system, resulting in over £1 billion in back payments being issued to rectify the issue.
Key Statistics: DWP’s Efforts in Correcting State Pension Errors
The DWP’s extensive correction exercise, which began in January 2021, has uncovered significant amounts of arrears. With over £800 million identified in underpaid pensions, the department has worked tirelessly to repay these amounts to those affected.
The latest data, as of March 31, 2025, reveals that £804.7 million has already been repaid to pensioners who were affected by the state pension underpayment errors.
Types of Pensioners Affected by State Pension Errors
Several groups of pensioners were particularly affected by these underpayments, including married women, widowed women, and women over 80 who were entitled to automatic increases but did not receive them.
The errors were varied, including situations where married women did not receive pension increases after their husbands retired, widows whose pensions were not reassessed after their spouse’s death, and pensioners over the age of 80 who missed out on automatic entitlement boosts.
Key Categories of Affected Pensioners
- Married Women (Category BL): Pensions were not automatically increased after their husbands retired.
- Widowed Women: Pensions were not reassessed following the partner’s death.
- Women Over 80 (Category D): Failed to receive automatic pension increases they were entitled to.
These errors impacted thousands of individuals and resulted in large arrears payments. The average amount of arrears received varied depending on the category:
| Category | Cases Reviewed | Underpayments Identified | Average Arrears Payment | Total Repaid |
|---|---|---|---|---|
| Married Women (Category BL) | 321,439 | 47,004 | £5,553 | £252.8 million |
| Widowed Women | 465,316 | 50,261 | £11,725 | £483.4 million |
| Women Over 80 (Category D) | 90,753 | 33,683 | £2,203 | £68.5 million |
Additional Efforts to Correct Errors: The HRP Review
In addition to correcting errors related to married women, widows, and those over 80, the DWP has initiated a second correction exercise that began in January 2024.
This initiative focuses on Home Responsibilities Protection (HRP), a benefit that safeguards the state pensions of individuals who took time off work to care for children before the year 2000. HMRC has already sent more than 370,000 letters to individuals who might have missed out on this protection.
As of September 2024, over 42,000 HRP applications were processed, and 19,000 were passed to the DWP for reassessment. More than 11,700 cases were reviewed, with arrears uncovered in over 5,000 instances, amounting to £42 million in repayments. The average payment for HRP-related arrears stands at £7,859 per person.
Total Repayments: Reaching Nearly £1 Billion
By the end of September 2024, combined efforts from the state pension and HRP correction exercises led to a total of £846 million in repayments.
Furthermore, an earlier HRP correction dating back to 2008, which was prompted by former pensions minister Steve Webb, resulted in £83 million in arrears being paid to 36,000 people. This brings the total repayments for underpaid state pensions and HRP to an impressive £929 million.
It is anticipated that the total amount repaid will exceed £1 billion in the near future as the HRP review continues.
Experts’ Opinions on the Situation
Steve Webb, a partner at LCP who played a pivotal role in uncovering these underpayments, commented on the scale of the issue, stating, “We have become so used to stories about state pension errors that it is easy to become dulled to the scale of what went wrong.”
He added, “It now looks as though the total amount underpaid will pass through the £1bn mark this year, with over 170,000 people having lost out.
The vast majority of those who lost were women, some of whom were underpaid for decades or even passed away without ever receiving the correct amount. The remaining corrections need to be handled urgently, and this should never be allowed to happen again.”
The DWP’s Response and Commitment
A spokesperson from the DWP reassured the public about the department’s commitment to ensuring that pensioners receive the benefits they deserve.
They stated, “Our priority is ensuring pensioners receive the dignity and security they deserve in retirement and that state pension underpayment rates remain as low as possible.”
The spokesperson further noted that most cases have been resolved, with only a small number of cases pending further documentation from the affected individuals.
The DWP’s correction exercise has uncovered significant underpayments of state pensions, resulting in substantial repayments to pensioners, particularly women. With efforts to address HRP-related errors also underway, the total amount repaid is expected to surpass £1 billion.
The ongoing process highlights the importance of ensuring that pensioners are given the correct entitlements, and the DWP is committed to resolving the remaining cases as quickly as possible.
FAQs
How many pensioners have been identified as underpaid by the DWP?
The DWP has identified 130,948 pensioners who were underpaid their state pensions due to errors in the system.
What is the total amount repaid to pensioners so far?
As of September 2024, the total amount repaid to pensioners is £929 million, with an expected total of over £1 billion in repayments.
Who are the primary groups affected by the pension errors?
The primary groups affected are married women, widowed women, and women over 80 who were entitled to pension increases but did not receive them.