Millions of people have been getting the wrong pension for years with 23% of pensioners being underpaid, the BBC has discovered. The Government has been aware of the problem since the 1990s.
The Department for Work and Pensions (DWP) told the BBC it is "investigating possible remedies". The BBC says 17% of people are being overpaid with some people being both underpaid and overpaid in different years.
The DWO decided in 2002 that it would be too complicated to fix the problem.
Sir Steve Webb, who served as pensions minster between 2010 and 2015,told the BBC: "The scale of these errors is truly mind-blowing."
He added: "It beggars belief to hear that a government department could simply decide that it was acceptable to pay the wrong rate of pension for decades, but feel under no duty to tell Parliament or the public.
"If the DWP has sat on this secret for decades, it makes you wonder how many other things simply get brushed under the carpet."
The Govermmment's 1980's-built Pension Strategy Computer System is unable to accurately calculate one element of the State Pension - the Graduated Retirement Benefit, reports the BBC.
In 2021, the National Audit Office found that problems with the system had separately led to 134,000 people who had claimed their state pension before April 2016 not receiving their full entitlement. The average underpayment was estimated at about £8,900.
In a statement, the Department for Work and Pensions said the errors were "decades old" and that "successive governments have not corrected this".
"A decision was made in 2002 not to make changes or corrections given the system's complexity and minimal impact on individuals, until a new computer system was introduced. The Department is assessing the scale of this issue and investigating potential remedies," a spokesperson said.
