The Department for Work and Pensions (DWP) has recently announced that more than 130,000 people have been awarded a combined total of £804.7 million in state pension back payments.
These payments are the result of historical government errors that were identified during a correction process that began in January 2021.
Pension Underpayment Correction Process
The correction process, which is set to continue until March 2025, has revealed 130,948 underpayments across various categories.
These underpayments have accumulated to a total of £804.7 million, and the DWP is working diligently to identify and correct any further errors.
The DWP has committed to checking hundreds of thousands of cases to determine if other pensioners are owed money. Below is a summary of who has been affected by the underpayments.
| Category | Average Payment Owed |
|---|---|
| Married Women | £5,553 |
| Widowed | £11,725 |
| Over 80s | £2,203 |
Groups Affected by Pension Underpayments
The underpayment errors primarily affect the following groups:
- Married Women with Low State Pensions: Women whose pensions were not automatically uplifted when their spouse retired.
- Widows: Individuals whose pensions were not automatically reassessed after the death of their spouse.
- Over-80s: People over the age of 80 whose state pension entitlements were not automatically increased.
The DWP clarified that a single case may fall under multiple categories, meaning a person could be affected by more than one error.
Additional Correction Exercise for Home Responsibilities Protection (HRP)
A separate correction exercise is focusing on missing periods of Home Responsibilities Protection (HRP), which led to inaccurate state pension payments for some individuals.
Between January and September 2024, 5,344 underpayments were identified, amounting to around £42 million in arrears.
How to Check if You Are Affected
While the DWP will contact some married women directly, it is important for widows and those over 80 to check whether they are entitled to any refunds.
To help individuals determine whether they are owed any money, pension consultants like LCP have provided a calculator to calculate the potential underpayment.
If you find that you are affected, you can contact the Pension Service to claim the back payments.
Expert Insight
Sir Steve Webb, a partner at LCP (Lane Clark & Peacock), commented on the impact of these underpayments:
“The vast majority of those who lost were women, some of whom were underpaid for decades or even went to their grave never paid the right state pension.”
He emphasized the importance of handling remaining corrections promptly and ensuring that such errors do not occur again.
DWP’s Statement
A DWP spokesperson emphasized the department’s commitment to ensuring that pensioners receive the dignity and security they deserve in retirement.
They assured the public that the vast majority of cases in the correction exercise had been resolved, with only a few outstanding cases due to further documentation being required from individuals.
The correction process launched by the Department for Work and Pensions has led to significant repayments for those affected by past government errors.
With over £804.7 million in back payments already distributed, the DWP continues to identify and correct errors, ensuring that pensioners receive the correct state pension entitlements they are owed.
FAQs
How much money has been paid back due to state pension underpayments?
Over £800 million has been awarded in back payments to more than 130,000 people.
Who is most affected by these underpayments?
The underpayments primarily affect married women, widows, and individuals over the age of 80.
How can I check if I am owed money due to pension underpayment?
You can use a pension calculator provided by LCP and contact the Pension Service for assistance.