LCP is calling on more women to come forward and get their state pension checked by the Department for Work and Pensions, saying they could be owed millions in underpayments.
In a report, published today (August 5), LCP said dozens of women had received lump sum repayments from DWP, with the average refund a little over £9,000, but some in excess of £30,000.
LCP is now calling on more women to come forward and make a claim after it found the DWP’s record checks, which see the government proactively contact women for repayments, captured only women who married after March 2008.
LCP estimates DWP has already refunded several million pounds to hundreds of women.
The issue of state pension underpayments for married women was first raised by LCP back in May and since then the firm has had more than 160,000 people visit its website calculator.
The women are being urged to check their state pension as under the old system married women could claim a basic state pension at 60 per cent of the full rate based on their husband's contributions, where this would be bigger than the pension they would get based on their own contributions.
Since March 17, 2008, this uplift should have been applied automatically but before this date, a married woman had to make a “second claim" to have her state pension increased when her husband turned 65 - and many women did not make that claim.
Sir Steve Webb, partner at LCP, said: “It is good news that DWP is checking its records to find married women who have been underpaid. I have no doubt that in addition to the millions which have already been refunded, this process will result in tens of millions of pounds being paid over.
“But this record check must be comprehensive rather than narrow. As things stand, many groups of women, including widows, divorced women and the over 80s will not get a call from the DWP, so they will have to ring up and ask for their state pension to be checked if they think they are being underpaid."
He added: “It would be far more efficient for DWP to do a comprehensive record check, including alerting women who still need to make a claim for an uplift. Without this, this issue will rumble on and on, and women will continue to miss out on the pension that is rightfully theirs”.
The report identified six groups of people who should contact the DWP for a state pension review.
These are:
- Married women whose husband turned 65 before March 17 2008 and who have never claimed an uplift to the 60 percent rate;
- Widows whose pension was not increased when their husband died;
- Widows whose pension is now correct, but who think they may have been underpaid while their late husband was still alive;
- Over 80s who are receiving a basic pension of less than £80.45, provided they satisfied a basic residence test when they turned 80;
- Widowers and heirs of married women, where the woman has now died but who was underpaid state pension during her life;
- Divorced women, and particularly those who divorced post-retirement, to check that they are benefiting from the contributions of their ex husband.
A DWP spokesperson said: "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."
According to LCP, a growing number of married women who never knew they needed to make a claim for an uplift (pre March 2008 women) are planning to make a complaint of ‘maladministration’ to the Parliamentary Ombudsman.
They will argue that DWP failed to ensure they knew about the need to make a ‘second’ state pension claim when their husband turned 65.
As a result of this they can now only get 12 months of backdating rather than 12 years or more of missed pension uplift.
amy.austin@ft.com
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