Tens of thousands of older state pensioners missing out on £1,000s due to DWP error – are you one of them?
TENS of thousands of older state pensioners could be missing out on thousands of pounds due to a historic error.
The mistake, which was first revealed in 2022, has seen 187,000 people miss out on retirement money they're entitled to.
The Department for Work and Pensions (DWP) has been on a mission to identify the pensioners, mainly women, who have been affected by the error.
Now an expert has revealed that more pensioners could be owed cash but have been unable to claim.
Those affected are parents who claimed Child Benefit before 2000 and are missing out on the extra cash due to gaps in their National Insurance (NI) records.
These mothers should have had ‘Home Responsibilities Protection’ (HRP) on their NI record since 1978 when they were raising children, but in many cases, this is missing which means they aren't getting paid all the state pension they should.
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It's understood that of the 187,000 affected by the historic error around 43,000 are now deceased.
In an effort to track these women down, HMRC has so far issued more than a quarter of a million letters to people over pension age with no HRP on their record, encouraging them to put in a claim.
They may then be issued backdated payments, as well as a new monthly income if they're found to have been affected.
However, a Freedom of Information (FOI) response to former pensions minister and current partner at LCP Steve Webb has revealed that tens of thousands still may not be aware they're missing out.
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Mr Webb received a copy of the letter which is sent out to those potentially affected.
He found that it relies largely on internet-based claiming.
Recipients are told not to apply until they have used an online check for HRP entitlement and then to put in their application online.
The letter makes no reference to any alternative way of claiming, despite the existence of a simple paper claim form (CF411) which can be used instead.
Research from Age UK suggests that almost 30% of people aged 75 or over never use the internet, which suggests that many of the recipients of these letters may not be able to act upon them.
Mr Webb is now calling on HMRC to review its communication strategy for older pensioners and to make paper claim forms readily available.
He said: "Whilst I understand the desire of government departments to cut costs, it is completely inappropriate to write letters to hundreds of thousands of pensioners which suggest that the only way to apply is online.
"At the very least, the letter should make it clear that other ways of claiming are available for those who are not online. I am concerned in particular for older pensioners who may not have friends or family to help them.
"Those who have been underpaid have typically missed out on thousands of pounds, and they deserve to have this put right. Unless HMRC addresses this issue it is highly likely that tens of thousands of older pensioners may continue to miss out on money which is rightfully theirs”.
What are state pension errors?
STEVE Webb, partner at LCP and former Pensions Minister, explains what state pension errors are and how they can occur:
The way state pensions are worked out is so complicated that many thousands of people have been paid the wrong amount for years without even realising it.
The amount of retirement pension you get usually depends on your National Insurance (NI) record.
One big source of errors has been cases where NI records have been incorrect, particularly for years spent at home with children.
This is a system known as ‘Home Responsibilities Protection’.
Alternatively, particularly for older pensioners, the amount you get can depend on the NI contributions made by your spouse.
Errors have arisen where the Government has failed to adjust the pensions of married women when their husbands retired or failed to increase pensions when someone was bereaved and lost a husband or wife.
Although the Government has spent years trying to fix these problems, there are still many thousands of people – many of them older women – on the wrong pension.
If you have always thought that your pension seems low, then it is worth contacting the Pensions Service to ask them to check, especially if you spent time at home raising children or if you were widowed and your pension didn’t change when your spouse died.
The DWP estimates that a total of £1.3billion is owed to those affected - that equates to an average amount of £5,000 owed to each individual.
When the mistake was uncovered the DWP described it as the "second largest" source of errors in state pensions.
Those affected are people who claimed child benefit, largely women who were stay-at-home mums, before May 2000 as they could have gaps in their NI record which in turn affects the amount of state pension they get.
The amount of state pension someone gets is based on their NI contributions and the number of "qualifying years" they have.
From 1978 to 2010, protection was provided for parents to avoid these gaps by a system known as Home Responsibilities Protection (HRP) credits.
This system was then replaced in 2010 by the one we have now, called National Insurance Credits.
If someone claimed child benefit before May 2000 and did not provide their NI number on the form, it's possible that their credits may not have been transferred to their NI account from the child benefit computer.
This may affect their pension entitlement and women who are now in their 60s and 70s are most likely to be affected.
The DWP has already started sending letters to people who might have been entitled to HRP between 1978 and 2010 but have no HRP on their NI record.
It says so far it has written to 370,000 people, of which 257,000 were over State Pension Age.
It expects to send several hundred thousand letters to those affected over the next 18 months.
Where errors are found, NI records will be corrected and the DWP will then recalculate state pensions and pay arrears.
This could result in increased pension payments as well as a lump sum payment.
An HMRC spokesperson said: "Contrary to what’s been claimed, the letters do include a helpline number to request a paper application form - although for most people it will be much quicker and easier to use our online service."
Last year, The Sun spoke to Susan Burton, 66, who almost missed out on £50,000 for her retirement because of this error.
Another woman, 74, has received a £17,000 windfall after falling victim to the error.
It means that finding out if you have been missing out, could mean a big payday.
What do I need to do now?
The DWP says it has begun the process by writing to those already over pension age.
For the tens of thousands of those affected who have died, it will be a matter of tracking down the families of the deceased.
Mr Webb told The Sun: ";The scale of this problem is such that it is going to take 18 months to try to track down all those who may have missed out.
"But HMRC’s records give them only very limited information about who to contact, so anyone who thinks they were eligible for Home Responsibilities Protection which may be missing from their state pension should check if they were entitled and put in an application."
What is Home Responsibilities Protection (HRP)?
BELOW we reveal what Home Responsibilities Protection (HRP) is and why if you received it before 2000 you could be missing out on cash.
From 1978 to 2010, protection was provided for parents to avoid gaps in their "qualifying years" by a system known as Home Responsibilities Protection (HRP) credits.
This system was then replaced in 2010 by the one we have now, called National Insurance Credits.
Most people got HRP automatically if they were getting child benefit in their name for a child under the age of 16 and they had given the child benefit office their National Insurance (NI) number.
If someone claimed child benefit before May 2000 and did not provide their NI number on the form, it's possible that their credits may not have been transferred to their NI account from the child benefit computer.
This may affect their pension entitlement and women who are now in their 60s and 70s are most likely to be affected.
If you think you may be entitled, but you have questions, the Pension Service can be reached using the or by calling 0800 731 0469.
Anyone who has received child benefit since 1978 should check their NI record.
If the payment is missing, there is a form that can be filled in to get the information added to your record.
It is called a and it can be found on the government's website.
You can also contact the HMRC National Insurance helpline for an application form.
Your state pension will then be automatically recalculated and the arrears will be paid.
You can still apply for HRP if, for the full tax years (April to April) between 1978 and 2010, if you were either:
- Sharing the care of a child under 16 with a partner you lived with and they claimed Child Benefit instead of you
- Caring for a sick or disabled person
Any HRP you had before April 6, 2010, have converted to National Insurance credits.
You must have reached state pension age on or after April 6 for these credits to go towards your pension.
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Elsewhere, the exact amount you need to retire comfortably – including holidays abroad - has been revealed.
Plus, a Martin Lewis fan has revealed how the expert's little-known tip helped them to boost their state pension by £7,000.
How much is the state pension worth?
YOUR State Pension amount depends on your National Insurance record.
The new State Pension is a regular payment from the government that most people can claim in later life.
You can claim the new State Pension when you reach State Pension age if you have at least 10 years of National Insurance contributions and are:
- a man born on or after 6 April 1951
- a woman born on or after 6 April 1953
The full rate of the new State Pension will be £221.20 per week in 2024-25 but you may get more or less, depending on your National Insurance (NI) record.
If you were born before the above dates you'll get the old State Pension instead.
The full basic State Pension under the old system is currently £169.50 per week for people who have all the qualifying years of NI contributions for their date of birth.
Do you have a money problem that needs sorting? Get in touch by emailing [email protected].
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