Women urged to find out if state pension is being underpaid

Married, divorced and widowed women are being urged to check whether they are being underpaid the state pension.

The heirs and successors of women who have been underpaid may also be able to claim a backdated refund.

Pensions consultants LCP (Lane Clark & Peacock) said more than 160,000 people have visited a calculator on its website since it published a report in May titled “Are tens of thousands of older women being underpaid state pension?”

It said that, while some women have been refunded by the Department for Work and Pensions (DWP), it is urging more women to get their state pension checked.

Some women have told LCP that they have received large lump sum repayments from the DWP, with the average refund it is aware of sitting at just over £9,000, but some amounting to more than £30,000.

The issue has arisen because, under the old state pension system, married women could claim a basic state pension at 60% of the full rate based on their husband’s contributions, in cases where this would be bigger than the pension they could get based on their own contributions.

Before March 17 2008, a married woman would need to make a claim to have her pension increased – but since that date the uplift should have happened automatically.

But LCP estimates that tens of thousands of “post-March 2008” women have not had their pension automatically increased.

On top of this, tens of thousands of “pre-March 2008” women are also thought not to have put in a claim to have their pension increased, and so have also been missing out.

LCP is urging six particular groups to contact the DWP to see if they could be entitled to more state pension. They are:

1. Married women whose husband turned 65 before March 17 2008 and who have never claimed an uplift to the 60% rate.

2. Widows whose pension was not increased when their husband died.

3. Widows whose pension is now correct, but who think they may have been underpaid while their late husband was still alive, particularly if he reached the age of 65 after March 17 2008.

4. Over-80s who are receiving a basic pension of less than £80.45.

5. Widowers and heirs of married women, where the woman has now died but was underpaid state pension during her lifetime.

6. Divorced women, particularly those who divorced after retirement, to check that they are benefiting from the contributions of their ex-husband.

Sir Steve Webb, a former pensions minister who is now a partner at LCP, said: “It is good news that DWP is checking its records to find married women who have been underpaid … But this record check must be comprehensive rather than narrow.”

He added that he is aware of “pre-March 2008” women who had not made a claim at the time their husband retired only receiving 12 months’ worth of backdated payments when they did eventually make a claim, despite missing out on state pension uplifts for at least 12 years.

Sir Steve said some of these women are in the process of approaching the Parliamentary and Health Service Ombudsman and he has written in support.

A spokesman for the DWP 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.”

The DWP said it would encourage anyone who thinks they have failed to claim a state pension increase they are eligible for to contact the department.

Helen Morrissey, pension specialist at Royal London, said: “The benefits system is extremely complicated and here is another instance where people are falling through the cracks and not getting what they are due.

“These payments could have an enormous impact on their standard of living and we urge any woman who thinks they might be eligible to check as soon as possible.”