DWP says nearly 100,000 older Brits were underpaid and could be due payouts up to £12,000

By Staff

Figures released by the DWP today showed that between January 2021 and February 2024, 97,016 state pensioners had been identified as having underpayments to their state pension with a total of £571.6million owed

Nearly 100,000 older Brits have been identified as having their state pensions underpaid by the Department for Work and Pensions (DWP) with thousands now receiving payouts.

Figures released by the DWP today show 97,016 state pensioners had been identified between January 2021 and February 2024 as having underpayments to their state pension, with a total of £571.6million owed. The underpayments affected certain groups of women who reached state pensions before April 2016.

This is because, after this date, a woman’s pension was no longer linked to their husband’s. The three groups of women affected by the underpayments were married women, widows, and those over 80. Some of the errors have been found to date back as far as 1985.

Of those identified, 43,367 married pensioners received an average payment of £5,713 each. Around 32,474 people over the age of 80 got an average of £2,192 each, and a total of 17,894 widowed retirees were paid an average of £12,486 per person. However, as these figures are just averages, the payouts received can be higher or lower than these amounts.

The DWP started the process of repaying pensioners who were underpaid in February 2021 and is expected to finish this project later this year. The total amount for payouts is expected to be around £1.17billion and around 170,000 pensioners are believed to be owed money, according to the DWP. However, estimations from pension experts say this figure could be even higher at 237,000 pensioners which could cost the DWP £1.46 billion.

Helen Morrissey, head of retirement analysis at Hargreaves Lansdown said: “Progress is being made to rectify the large-scale issue of state pension underpayments, but it is very slow. Just over £571million has been returned so far but with estimates suggesting the scale of underpayments could be around £1.5billion there’s still a very long way to go.

“People have the expectation that the state pension they receive is correct but a series of errors in an already overly complicated system means that for many thousands of people this expectation has been incorrect. Some who queried the issue with DWP over the years were told there was no problem, and many have suffered real financial hardship as a result. These people have been let down and need resolution as soon as possible.”

Those affected will be contacted by the DWP as soon as their case has been evaluated. The pensions department will likely send you a letter confirming how much back pay you are entitled to. If you believe you are owed pension back payments, you should not contact the DWP but instead should call the Pension Service. This is usually the quickest way to find out if you are eligible for a repayment. You can call the Pension Service on 0800 731 0469. Full contact details can be found on the Gov.uk website here.

A DWP spokesperson said: “The action we are taking now is correcting historical underpayments made by successive Governments. Our priority is ensuring pensioners receive the financial support to which they are entitled and we have set up a dedicated team and devoted significant resources towards completing the correction exercise.”

Who was affected by DWP state pension underpayments?

According to the DWP’s update, three groups were affected by underpayments and these include:

  • Category BL (Cat BL) – People who were married or in a civil partnership who reached state pension age before April 6, 2016 and should’ve been entitled to a Category BL uplift based on their partner’s National Insurance contributions
  • Missed conversions – People who have been widowed and their state pension was not increased to include any amounts they were entitled to inherit from their late husband, wife or civil partner
  • Category D (Cat D) – People who reached age 80 and who were getting some basic state pension but less than £85.00 (in 2022-23) and may therefore, subject to satisfying the appropriate residency conditions, be entitled to Cat D state pension of £85.00 a week

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