Surge in grandparents claiming pension boost for looking after grandchildren

There has been a seven-fold surge in the number of grandparents claiming valuable credits which could boost their state pension because they are looking after grandchildren, according to a mutual insurer.

Royal London, which obtained the data, said despite the increase, the number claiming still only represented about one in 10 of those who may be entitled to do so.

A year ago, Royal London obtained HM Revenue and Customs (HMRC) figures which showed that just 1,298 grandparents or other family members had claimed this national insurance credit in the year from October 2015 to September 2016.

But it said after publicity surrounding "poor take-up", interest had surged.

A new freedom of information (FOI) reply showed that there were 9,486 applications in the year to September 2017 - a seven-fold increase in a year.

When a grandparent is looking after a grandchild and this allows the child's parent to get back to work, the grandparent may be entitled to a national insurance credit to help them build up a full state pension.

A grandparent who looks after a grandchild for one year could add about £230 per year to the amount of state pension they get in retirement.

Over a typical 20-year retirement this could be worth more than £4,500, Royal London said.

Sir Steve Webb, a former pensions minister who is now director of policy at Royal London, said: "It is right and proper that when grandparents sacrifice their own working life to help a family member get back to work, they should not also damage their own state pension prospects.

"This national insurance credit is a valuable right and it is good news that the numbers claiming have risen so dramatically in such a short space of time.

"But we believe that there are tens of thousands more grandparents who could be entitled to benefit and would encourage more of them to find out about the scheme and to make a claim."

More information about specified adult childcare credit is at www.gov.uk/government/publications/national-insurance-credits-for-adults-who-care-for-a-child-under-12-fact-sheet/specified-adult-childcare-credits-fact-sheet.

The credit would mainly be relevant to grandparents who look after grandchildren but could apply to other family members.

The person doing the caring needs to be under state pension age to benefit from a credit towards their future state pension.

A Department for Work and Pensions spokesman said: "It is important that people take up the support on offer and there are a range of credits available that can help boost their state pension.

"For anyone on the cusp of retirement our advice is to get to know their pension and find out what they might be entitled to. From help with the cost of their heating to topping up their state pension there is a wealth of support to help in retirement."