Despite a huge correction exercise currently being undertaken by the Department of Work and Pensions (DWP) on historic state pension awards, errors are still being made on new state pension awards according to LCP partner and former pensions minister Steve Webb.
Steve Webb has now written to the pensions minister, Guy Opperman, giving examples of recent errors and calling for further action to improve accuracy.
A key area of error relates to women who previously paid a reduced rate of National Insurance Contributions, commonly known as the ‘married woman’s stamp’. Such women may find that under the rules of the new state pension they lack the 10 years of full rate contributions necessary to qualify for any state pension. But the new system has a special concession for such women, provided that they were paying the reduced stamp 35 years before they retired. Such women can automatically get a pension of £85 per week if they are married or £141.85 if they are widowed or divorced.
A previous FOI request from Steve Webb revealed that DWP discovered in 2019 that it was making errors on such cases and a correction exercise was put in place at the time. But the former Minister has continued to hear from women who have wrongly been told they have no pension entitlement, including one who retired in April 2022. He has therefore written to DWP with details of four such cases and is calling for action to be taken to stop this from happening again.
|Case study: Mrs Estelle Henley
Mrs Henley reached pension age in April 2022. Before retiring she worked full-time in her daughter’s pub for fifteen years. She lives near Southampton with her husband Rob who is aged 72 but still in part-time work, partly to support the couple until Mrs Henley’s state pension became payable. Mrs Henley claimed her state pension in the usual way but was shocked to receive a letter from DWP dated 21st April 2022 saying “We cannot pay you UK state pension” because she did not have the requisite number of years of contributions. From previous correspondence with DWP in 2015 she was aware of the special rules for people who paid the ‘reduced stamp’, so she challenged DWP directly and also contacted Steve Webb. DWP have now accepted their error, phoning Mrs Henley to apologise and have paid arrears back to the start of her claim. Mrs Henley said: “I knew that something was wrong when I was told I wasn’t entitled to a pension, but there may be other women who might not realise they have been given the wrong information. I would encourage anyone who has been turned down for a pension to make sure that an error has not been made”.
Commenting, Steve Webb, partner at LCP said: “When DWP admitted to me that they had been making errors for this group of women I assumed that they would have put in place procedures to sort out the problem.
“Yet I continue to hear from women who have been wrongly told that they are not entitled to a pension. What concerns me most is how many other women there may be who simply trusted what DWP have told them and are now struggling to get by without the pension which is rightfully theirs. DWP should be checking all their records for such cases and putting things right, as well as making sure that these mistakes cannot happen again”.