State Pension potential backdate/compensation
Our Bureau had a query from a client yesterday regarding compensation for her state pension claim. This seems to have related to an article our client read in the Daily Record/ Mirror. It seems to revolve around the following-
This affects women who were married and reached state pension age (SPA) before April 2016, who can claim the basic state pension. These women are entitled to 60% of the basic state pension their husband gets at SPA. For 2020-21, the rate for married women claiming on this basis would be £80.45 per week. Under this old system, each member of a couple could build up a pension in their own right. So, in principle, each member of a married couple could earn a full state pension. But many women had gaps in their National Insurance (NI) record or had paid the specially reduced ‘married woman’s stamp’, and so reached pension age with very limited pension entitlement of their own.
The women affected will have been born before 6 April 1953 and are most likely to be widows, married or divorced women and those aged over 80. If you’re a widow, you could also substitute your late husband’s NI record for your own, thereby qualifying for 100% of the basic state pension if your late husband had a full record of contributions. If you were divorced when you reached SPA you could substitute your ex-husband’s NI record for your own, up to the point of your legal split. If the divorce occurred relatively late in life, this could enable you to qualify for a full basic state pension.
Two groups of women may be affected:
• Until March 2008, a married, divorced or widowed woman would have to make a claim to receive this enhanced pension. For women whose husbands reached SPA (which was then 65 for men) after March 2008, the DWP’s computer systems should have boosted their state pension payments to the 60% sum. But many women have said that it didn’t, and have complained to the DWP.
• Women whose husbands reached 65 before March 2008. The DWP claims it wrote to these women to alert them of this option but many say they never received any correspondence.
For those whose husbands reached SPA after March 2008, the DWP says it has backdated these payments, plus interest on top. Unfortunately, for women whose husbands reached SPA before March 2008 and who want to claim now, it would be treated as a ‘new claim’ for a pension and therefore backdated by just one year. The DWP state that they are checking for further cases and will pay the arrears that are due (post-2008 cases only).
Does anyone have any further information about this, particularly from gov.uk or an official source?
Thanks in advance
We heard about this a couple of days ago, but don’t have any other information at this stage I’m afraid.
There is a paper by Steve Webb highlighting the issue available to download here https://www.lcp.uk.com/pensions-benefits/policy-papers/are-thousands-of-older-women-being-short-changed-on-their-state-pension/
(I hope I am not breaking any forum rules by posing a link to a commercial website)
Here;s the response we got from DWP in it’s entirety.
As you will be aware, Sir Steve Webb has been publicising the issue and a number of pensioners who think they might be affected have now contacted DWP. Where we find that there are errors in a case, we put them right and pay any arrears due. From our data it is hard to judge the exact numbers that might be affected so we are also checking for cases. If people do contact you, I would advise them to contact the Department (details can be found online at http://www.gov.uk/contact-pension-service) to ensure their case can be considered promptly. We would have no objections to you putting advice on your website.
In an update from Steve Webb (partner at Lane Clark & Peacock LLP and former Pensions Minister under the Cameron coalition government) he welcomes that DWP is now checking for state pension underpayments -
‘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.
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.’
Further update from Steve Webb
Has anyone attempted to challenge the restriction of arrears for one year to the women impacted before the automated uprating started in 17/3/08? Could this be discrimination on age grounds in so much as women with partners turning 65 after this date are treated differently to those prior to it? If so would it be through JR rather than usual grounds of appeal?
Sorry for all the questions!