The Department for Work and Pensions (DWP) in the United Kingdom is addressing a significant pension underpayment issue, particularly for women born between April 6, 1950, and April 5, 1960.
Many women in this age group have unknowingly been underpaid their state pension due to administrative errors.
The DWP’s pension underpayment correction initiative is now underway, aiming to rectify these discrepancies and provide compensation to those affected. Here’s everything you need to know.
What Led to the Pension Underpayments?
Several issues contributed to the underpayment of pensions for women aged 60 to 70. The primary cause was errors related to National Insurance (NI) contributions and outdated pension processing systems.
These errors were particularly prevalent for women who took career breaks to care for children or family members. Below are the key causes of pension miscalculations:
- Home Responsibilities Protection (HRP) Errors: HRP was meant to protect women’s NI records during caregiving years, but many women found their HRP credits missing or inaccurately recorded.
- Inherited Pension Inaccuracies: Women who were entitled to inherit pension rights from deceased spouses or civil partners often did not receive the correct amount due to system errors.
- System Transition Mistakes: The transition from the basic State Pension to the new State Pension in April 2016, along with the gradual increase in women’s pension age from 60 to 65, caused technical issues.
The Scale and Progress of the Correction Process
The DWP has launched one of its largest ever pension record reviews, examining approximately 800,000 pension accounts. The total budget allocated for the pension underpayment correction process is a substantial £1.1 billion.
As of the latest update, £104 million has already been disbursed, with much more to come. The payments to individual women range from £8,300 to over £10,000 per person, depending on the amount they were underpaid.
DWP Pension Correction Overview
| Aspect | Details |
|---|---|
| Eligible Age Group | Women aged 60 to 70 |
| Years of Birth Targeted | April 6, 1950 – April 5, 1960 |
| Records Being Reviewed | Around 800,000 |
| Total Correction Budget | £1.1 billion |
| Amount Disbursed So Far | £104 million |
| Average Payment Per Person | £8,377 |
| Maximum Known Payments | Over £10,000 |
How Payments Are Being Delivered
The DWP is contacting eligible women by sending formal letters, explaining the nature of the correction and the amount due. Once verified, the payment is delivered as a lump sum directly into the recipients’ bank accounts.
The process is automatic for most individuals who are identified, meaning there is no need to submit a formal application.
However, women who believe they may have been underpaid but have not received a letter are encouraged to take action. They can verify their records and ensure they receive the compensation they are owed.
What Should Affected Women Do?
Women aged 60 to 70, particularly those born between April 6, 1950, and April 5, 1960, should follow these steps to verify their pension records:
- Review National Insurance Contributions: Visit the HMRC online portal to check your full NI contribution history. Look for any unexplained gaps, especially during years when you were caregiving.
- Contact the DWP: If you suspect underpayment and have not received a letter, call 0800 731 0469 to inquire about your pension records and possible arrears.
- Check for Inherited Pension Rights: Women who were married or in civil partnerships, particularly those whose spouse has passed away, should ensure their inherited pension rights are processed correctly.
- Seek Assistance: For help navigating the process, organizations like Citizens Advice and Age UK can offer support and guidance.
Administrative and Public Response
The pension underpayment issue has sparked renewed calls for better oversight and transparency in how pensions are managed.
Advocacy groups, including WASPI (Women Against State Pension Inequality), have highlighted how women have been disproportionately impacted by past policy changes and administrative errors.
Although this pension correction initiative is not directly linked to WASPI’s campaign regarding state pension age changes, it aligns with broader demands for fairness and accountability in pension management.
The DWP’s pension underpayment correction initiative is a vital step in addressing long-standing issues affecting women’s pensions.
With compensation amounts ranging from £8,300 to over £10,000, women in the affected age group should take action to ensure they receive any owed payments.
While the process is underway, there is still time to verify records and seek compensation.
FAQs
How much are women aged 60-70 expected to receive through the DWP pension correction?
Women aged 60-70 could receive £8,300 or more, depending on the amount they were underpaid.
What is the total budget allocated for this pension correction process?
The total correction budget is £1.1 billion.
How can women check if they are eligible for the pension underpayment correction?
Women can visit the HMRC online portal to review their National Insurance contributions or contact the DWP for further assistance.