The Daily Telegraph - Saturday - Money
‘No justice for 15 years of underpaid state pension’
Tens of thousands of women who have been underpaid the state pension for more than a decade are mounting a fight after being blocked from claiming money they were due.
More than 200,000 women have been short- changed by a combined £ 2.9bn and forced to live on less in retirement due to a government oversight, which it has promised to rectify.
However, it has been estimated there are 50,000 women who will be excluded from the Department for Work and Pensions repayment project, according to Sir Steve Webb, the former pensions minister.
Many married women missed out on a one- off increase in payments as the process of claiming an additional amount of state pension, based on a husband’s records, was only made automatic in 2008. Before then women had to apply for the uplift. Those who were unaware they could boost their state pension missed out.
The responsibility for claiming the extra money was on these women and the DWP said it was not its legal duty to notify them. This means many will not be paid the same sums given to women retiring after 2008.
Barbara Young, 80, from Kent, said she contacted the DWP after reading this newspaper’s reports and was told that she had been receiving less than she was due for nearly 15 years.
However, the Government said it would only pay out money covering the 12 months before her claim, leaving her out of pocket for the previous years, she said. Mrs Young said she had not been told how much she had been underpaid or how much she would receive in compensation.
“It’s really unkind. I feel it was not my place to check they were doing their job and that I have to pay for this now. We have paid for this all our lives, it’s not like the state pension is free,” she said.
Mrs Young, who is a town councillor, said she was told she should have submitted a claim when her husband started receiving the state pension and therefore it was her mistake.
A spokesman for the DWP said: “Married women whose husbands reached state pension age after them, but before March 17 2008, are required by law to make a separate claim, and application forms were provided.”
Before new rules came into effect in April 2016, women could claim an enhanced pension when their husband retired by substituting his National Insurance credits for their own. This was based on the assumption men were the main breadwinners while women sacrificed their careers to raise children, therefore making fewer National Insurance contributions and racking up a smaller state pension entitlement.
For example, the married woman’s standard rate is £82.45 for the 202122 tax year, but they may be able to raise that to £137.60 a week if their husband has a full contribution record.
Sir Steve, now a partner at LCP, a consultancy, said that he supported women who were preparing a complaint to the Parliamentary Ombudsman. The pensioners will accuse the Government of maladministration, it is understood. “It is the 21st century, you can’t give this information to the husbands and rely on them,” he said. “Women know their husbands’ 65th birthdays but not necessarily when they started to claim the state pension. Their husbands have no legal obligation to tell them. If these women rang the DWP they wouldn’t be given their partners’ private details.”
Those whose husbands claimed the state pension after 2008 have been promised a full refund by the DWP, which should have automatically processed the uplift. More than 74,000 married women are to receive a windfall of up to £23,000, while widowed retirees are owed an average of £17,000.
The DWP admitted it could have identified the scale of the issue sooner, as several cases came to light between February and May last year. The department’s latest annual report revealed that warnings were ignored in some cases. Despite this newspaper’s reports in May last year, the Government only started scanning cases to determine the scale of the problem in July. Six months later, the Government started to identify and rectify the errors, but more than 400,000 cases require further investigation. Women’s state pension entitlements have proved an area of high contention even before the underpayment scandal. Campaigners were given hope this week after the Parliamentary Ombudsman ruled that Government officials were too slow to write to women about how they would be affected by a rise in the state pension age. Women born in the 1950s, whose state pension age increased from 60 to 65, have long argued that they did not have enough time to prepare.
A spokesman for the DWP said: “Both the High Court and Court of Appeal have supported the actions of the DWP, under successive governments dating back to 1995.”