A former pensions minister has hit out at "shocking" delays which have led to hundreds of thousands of pensioners still being underpaid their state pension.
Sir Steve Webb was reacting to the latest figures from the Department of Work and Pensions (DWP), which show that just 13% - or 32,000 - of state pensioners had received refunds after the DWP identified 237,000 had been underpaid, some stretching back decades.
The DWP has so far paid out £209 million of the £1.46billion it owes, so more than a billion pounds is still outstanding.
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Sir Steve, who served as Minister of Pensions in the Conservative-Lib Dem coalition government, and is now a partner at consultants LCP, said: "It is quite shocking that well over a hundred thousand pensioners are to this day receiving the wrong rate of pension, and the DWP is clearly way behind schedule in fixing the problem. With cost of living pressures affecting many elderly people on low incomes, it is essential that the pace of fixing these errors is stepped up and people get the money they are due as soon as possible. The scale of these underpayments is so great that putting it right could easily end up taking four years or more from start to finish."
The repayment process was meant to finish by the end of 2023, but the deadline has now been pushed back to late 2024.
Pensioners can be underpaid the state pension for a number of reasons, but the three main groups identified by the DWP are:
- Married women, who should have received an upgrade to a 60% basic state pension when their husband retired;
- Widows (and widowers) who should have inherited an enhanced state pension when their spouse died;
- Over 80s already getting a state pension when they turned 80, who should have been automatically upgraded to a 60% basic state pension.
The DWP said it was committed to correcting the errors and expected the speed to increase going into 2023, as it would continue to allocate more workers to address the overpayments issue. A spokesman 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."
The spokesman said data shows that almost 58,000 cases have been reviewed in the last seven months compared to a total of 54,000 reviews in the first 15 months.
But Hargreaves Lansdown senior pensions and retirement analyst Helen Morrissey said: " The DWP has let pensioners down on a massive scale – particularly women who tend to retire on lower incomes anyway. In some cases, these underpayments have stretched back decades and even though DWP has pledged to hire more people to speed up the process, it is clear many could be waiting for some time still before they are reunited with their money."
DWP has spotted the errors and repayment should be automatic, but if you think you may not be getting the full amount you are entitled to from your state pension you should contact the Pension Service. Make sure you have your National Insurance number to hand when making your claim, along with details of what you currently get in state pension.
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