A former pensions minister has warned the Women Against State Pension Inequality Campaign (WASPI) that they are likely to receive “tiny bits of compensation” and not the “thousands and thousands” they may be expecting once the Parliamentary Ombudsman has released its final report.
Former Liberal Democrat MP Sir Steve Webb, who held the post of pensions minister under the Coalition government, appeared on The Martin Lewis Money Show Live this week in a special edition of the programme looking at pensions. He is now a partner at Lane Clark and Peacock - the pensions consultancy firm which first helped identify State Pension underpayments for thousands of women.
His comments came in response to a query from a viewer called Julie, who emailed the show and said: “Like so many other WASPI women, I had no notification that my pension age had risen to 66. I was expecting to retire at 60, the extra six years came as a terrible blow, but still no movement on any sort of resolution, why?”
Martin Lewis explained: “The Waspi and over-60s campaign has been going on a long time and it’s something I’ve supported. It all happened because in 1995 the State Pension age was extended and it wasn’t communicated, then it was extended again and wasn’t communicated.
“There’s been a court case that was lost, there’s been a Parliamentary Ombudsman ruling that has been won but we don’t yet know the result.”
An estimated 3.8 million women across Great Britain missed out on State Pension payments due to the change in retirement age from 60 to 65 between April 2010 and November 2018, which later increased to 66 for men and women in October 2020.
The 1995 Pensions Act increased the State Pension age for women from 60 to 65 in order to equalise the age with men, with the change to be phased in over 10 years from 2010 for women born in the 1950s.
The financial journalist also shared how Sir Steve Webb used to be pensions minister at the Department for Work and Pensions (DWP), under the Coalition government and was minister when one of the State Pension ages was increased.
He asked him: “Did you get it wrong?”
Sir Steve replied: “I don’t think we got it wrong but what happened before that, which the Ombudsman found was that the previous government knew that women didn’t know. That was the issue.”
He then explained how making the State Pension age the same for both men and women was the right thing to do, but people had to be told of the change.
He said: “The Ombudsman found that when the government I was part of raised the pension age a bit further, we wrote to millions of people and I know because we had lots of replies, so those letters went out.
“But what didn’t happen, was earlier on those letters never got sent and that’s why so many women didn’t know.”
Martin said it was the “biggest single question we’ve had” about pensions and he wanted to deal with it, but told viewers it was more of a political than a practical question.
He then asked Sir Steve if he thinks there will be any resolution to the ongoing compensation issue for the women affected by the State Pension age changes.
Sir Steve said: “The only avenue open is the Parliamentary Ombudsman whose report is imminent - the final report.
“The rumours are tiny bits of compensation, but not the thousands and thousands that people have lost working to 66.”
Martin briefly mentioned that compensation figures that had been floating around were over £10,000.
He told viewers: “Thank you to all the Waspi and over-60s women who have got in touch on this, it’s more a political issue than a practical one but I did want to include it in the show.”
In July 2021, the Parliamentary and Health Service Ombudsman (PHSO) ruled that the Department for Work and Pensions (DWP) failed to communicate the changes with enough urgency, finding it guilty of maladministration, and is currently investigating the harm caused. The PHSO found that "the opportunity that additional notice would have given them to adjust their retirement plans was lost”.
To keep up to date with the latest State Pension news, join our Money Saving Scotland Facebook page here, or subscribe to our newsletter which goes out daily, Monday to Friday - sign up here.
READ NEXT:
- People making new claim for State Pension this year may not receive first payment straight away
State Pension payments rising to more than £815 each month from April
New claims for Pension Credit increase as more older people apply for £3,50 income boost
New State Pension payments may be less than older people retiring this year expect
DWP benefits older people can no longer claim when they reach State Pension age
