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Daily Mirror
Daily Mirror
Business
Sam Barker

Thousands of retired people may be OWED money after DWP pension errors

Thousands of state pensioners may be owed extra payments due to past government mistakes now coming to light, an expert says.

These mainly affect pensioner couples where one partner has passed away, as well as married women getting the new state pension .

Many pensioners hit by these errors should have had top-up payments, but are being urged to check - especially older married women, as mistakes are still ongoing.

One batch of people owed money reached state pension age before April 6, 2016, and inherited a pension from their deceased partner who reached state pension age after that point.

Some of these inherited pensions grew by less than they should have due to Department for Work and Pensions (DWP) errors.

Former pensions minister Steve Webb, of financial firm Lane, Clark and Peacock (LCP), uncovered the issues from Freedom of Information requests.

The mistakes were discovered by former pensions minister Steve Webb (Getty Images)

Webb said another group of people with smaller state pensions than they should have are women who paid the 'married woman's stamp'.

These stamps are reduced National Insurance contributions offered as an option to all women who worked pre-1977, and millions paid them.

At the time, social norms meant many were expected to rely heavily on their husbands' pensions and not their own.

But changes to pension rules in April 2016 meant women now get state pension payments based on their own National Insurance record, not their husband's.

This meant people paying the married woman's stamp faced lower state pensions, but they may be eligible for top-up payments from the DWP to make up for this.

The latest finding is that many women are still not being paid the right amount, despite the problem coming to light in 2019 .

LCP partner Steve Webb said: "Whilst anyone can make a mistake, what is worrying about this catalogue of errors is how long it can take for anyone to spot that anything is wrong.

"In one case it was three years after the new state pension was implemented before anyone spotted a systematic problem with the payments to certain married women.

"It is also surprising that information about these errors and correction exercises has not previously been made public. DWP need to improve on two fronts – better error checking to make sure people are not paid the wrong pension in the first place, and greater transparency so that the public is told when things have gone wrong."

A DWP spokesperson said: “This year we will spend over £100billion on the state pension and our priority is ensuring every pensioner receives all the financial support to which they are entitled. These correction exercises highlight how, where errors do occur, they are identified and rectified.”

Last month The Mirror reported that the state pension is due to rise by more than seven per cent next year after the Chancellor confirmed the triple lock would be reinstated.

Rishi Sunak said the rise in April 2023 would be in line with the inflation rate in September this year, which is expected to be around 7.4 per cent, according to Bank of England forecasts.

Under the terms of the triple lock formula, the state pension must rise by the highest out of average earnings growth, 2.5% and inflation, but this year it was suspended due to skewed earnings growth during the pandemic.

If it had gone ahead, it would have brought a rise of more than 8% for pensioners battling a fast-rising cost of living crisis. Instead, it will rise by just 3.1% on April 11.

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