Elderly men and women who have been underpaid on their state pensions are being turned away by government call centre staff – with some having phones hung up on them, a committee has warned.
That’s despite the Department for Work and Pensions (DWP) itself admitting it has underpaid pensioners – namely women – by more than £1billion.
Now concerned men and women are being turned away by government call centres, according to MPs.
Officials at the Department for Work and Pensions have been ordered to cut short calls about the state pension from anyone who does not fit into a specific set of groups, according to Westminster’s Public Accounts Committee and the Work and Pensions Select Committee.
The “extremely worrying” policy was highlighted in a joint letter from the two committees.
Stephen Timms, chair of the select committee, and Dame Meg Hillier, of the PAC, warned some pensioners could lose hope in the fight for a fair pension. Around 134,000 have been underpaid in total.
Some of them could be owed lump sums amounting to tens of thousands of pounds – but the DWP has previously said it could take years to pay the funds back because of the time it takes to track each individual down.
The DWP has set its own deadline of December 2023 for these reviews.
Latest figures show just 9% of the £1billion owed has been repaid.
Sir Steve Webb, a former pensions minister who uncovered the underpayments, said it was “worrying” the DWP had not made more progress.
Sir Steve, who is now partner at consultancy LCP, warned there was a risk those who need to actively make a claim in order to get their money back “might get fobbed off”.
The errors mostly affect widows, divorcees and women who rely on their husband's pension contributions for some of their pension.
The failures were linked to outdated government systems and poorly trained staff who failed to identify the underpayments.
And according to a report by the Public Accounts Committee (PAC), there is still no formal plan for contacting the next of kin where a pensioner who was underpaid is dead.
A DWP spokesman said: "The action we are taking now will correct the historical underpayments that have been made by successive governments and we have set up a dedicated team and devoted significant resources towards completing this.”
Dame Meg Hillier, chairwoman of the PAC, said: "Departments that make errors through maladministration have a duty to put those it wronged back in the position they should have been, without the error.
"DWP is now on its ninth go at fixing these mistakes since 2018, the specialised staff diverted to fix this mess costing tens of millions more to the taxpayer and predictable consequences in delays to new pension claims.
"And there is no assurance that the errors that led to these underpayments in the first place will not be repeated in the correction exercise.
"This is a shameful shambles."
Who is affected?
It is thought that around 90% of those affected are women.
Out of 134,000 cases, around 94,000 are still alive and around 40,000 have died and payments could be made to estates. The DWP’s most recent records show 15,000 remain unidentified.
The underpayment relates to the "old" state pension system - affecting those who reached pension age before 6 April 2016 - when special provisions applied for married women.
Many of these people do not have a full NI record, and should have received certain increases in their basic state pension.
Under these rules, married women who had a poor pension in their own right could claim a 60% basic state pension based on their husband's record of contributions.
However, some of these pension were not automatically increased at a certain point.
Others who missed out include pensioners who should have been paid the minimum 60% of the basic state pension after they turned 80.
The basic rate state pension pays £137.60 a week, so someone on a 60 per cent rate should receive around £82.45.
The Department is prioritising individuals who fall into "at risk" categories, such as those who are widowed or aged over 80.
Married couples can refer to their most recent annual state pension statement to check if they are affected.
You could be underpaid if you are:
- A married woman over state pension age, who reached pension age before 6 April 2016 and
- Your husband is over state pension age and
- Your husband has a full basic state pension, currently £129.20 a week, in his own right and
- You are getting a weekly basic state pension of less than £77.45 per week.
How to check if there's a shortfall on your pension
The DWP says those whose husband became entitled to their pension on or after March 17, 2008, do not need to take any action and will be contacted.
To check if you’ve been underpaid, you can use this online calculator created by Lane Clark & Peacock.
You can also check how much you are being paid by monitoring your bank account or annual state pension statement.
If you think you have not had the correct state pension amount for any other reason, you should contact the Pensions Service arm of the DWP directly.
You can call on 0800 731 0469, but be aware that the lines are only open from 9.30am to 3.30pm Monday to Friday.
