State Pension warning: Women urged to check for ‘New Year windfall’ through back payments
Martin Lewis discusses checking state pension underpayments
The State Pension is intended to support people who have left the workforce, after years of hard work and National Insurance contributions. The sums people are entitled to will vary based on these contributions, but the full new state pension amount stands at £175.20 per week. It is, however, worth noting the government states: “You may get less than the new full state pension if you were contracted before April 6, 2016.”
There has, however, been a revelation in recent months which will affect some women, and taking action this New Year is key.
Research undertaken by the firm Lane, Clark and Peacock (LCP) has shown tens of thousands of women have potentially been underpaid their state pension.
Women are now being urged to check their state pension sum, as complex rules could mean some have missed out.
Under old state pension system rules, married women were able to claim a basic state pension sum at 60 percent of the full rate based on the National Insurance contributions made by their husband.
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This, however, was only permitted if the sum would be bigger than the pension a woman would receive based on their own contributions.
Since March 17, 2008, this uplift should have been applied automatically, but it has been estimated tens of thousands of women in this situation did not have their pension increased.
Before this date, a woman will have needed to make a second claim to have her state pension sum increased.
Women should have received correspondence from the DWP, letting them know about the option to increase their amount.
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However, some women have conveyed they did not receive a letter to let them know about the issue, and have therefore been affected by underpayment.
The Department of Work and Pensions (DWP) is now checking its records to determine which women have been affected by the matter.
It has urged women to come forward and contact the government if they believe themselves to have been affected.
The report by LCP, has also encouraged women to take action immediately to claim the sum to which they are entitled.
Steve Webb, former pensions minister, and partner at LCP, said some women could be in for a “New Year windfall”.
Commenting recently, he said: “We know that thousands of todays married women are getting the wrong rate of state pension.
“It is therefore inconceivable that there are not also thousands of widows who were underpaid in the past while their husband was still alive.”
The organisation has prepared a webpage to help women determine if they have been underpaid in the past.
In most instances, women have been paid the amount to which they are entitled, but there have been some discrepancies.
Back in 2020, Peter Schofield, the permanent secretary at the DWP told the Work and Pensions Select Committee 11,000 cases have been received.
Some 7,200 cases had been reviewed at that point, with 5,300 turning out to be correct.
However, Mr Schofield acknowledged the complexity of the issue, and said the DWP would be working through cases.
A DWP spokesperson previously told Express.co.uk: “We are aware of a number of cases where individuals have been underpaid State Pension. We corrected our records and reimbursed those affected as soon as errors were identified.
“We are checking for further cases, and if any are found awards will also be reviewed and any arrears paid.”
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