DWP identifies state pensioners due back-payment averaging over £12,000

Nearly 18,000 widowed pensioners have been paid figures averaging over £12,000 in back-dated state pension payments following a review of their entitlement.

The Department for Work and Pensions (DWP) previously announced hundreds of thousands of women who reached state pension age before April 2016 had been underpaid their state pension due to “historical errors”.

The errors, which came to light in 2020, were attributed to “outdated IT systems” and complicated rules that meant claims for pension increases had to be made manually instead of processed automatically. The underpayments are estimated to be worth around £1.46billion.

The DWP has been working to repay people since 2021 and according to new figures published, the Government has paid £497million to 82,323 people between January 11, 2021 and October 31, 2023.

Nearly 594,000 cases have been reviewed, with 240,786 of them related to ‘missed conversions.’

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These cases involve individuals who were widowed, and their state pension was not adjusted to include the amounts they were entitled to inherit from their late husband, wife, or civil partner.

A total of nearly £220million has now been paid out to 17,894 pensioners affected by a ‘missed conversion’, with an average arrears payment of £12,383 – and many more people could be due.

Viscount Younger of Leckie recently informed the House of Lords that the total number of State Pension cases to be reviewed for errors is approximately 678,000. Among these, the DWP estimates that 170,000 people have been underpaid.

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Viscount Younger also informed peers that the DWP is “on track” to finish the corrections exercise by the end of this year for married women or those in a civil partnership (category BL) and individuals over 80 (category D).

Of the married women or those in a civil partnership, 37,488 underpayments were identified and a collective £220.3million has been paid out, with individual cases averaging £5,931 according to data. Of those aged over 26,941 underpayments were identified and a collective £56.7million was paid out, with individual cases averaging £2,245.

Viscount Younger added that reviewing ‘missed conversion’ cases will extend until late 2024, concluding by the end of next year.

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Former Lib Dem pensions minister, Sir Steve Webb, now a partner at LCP (Lane Clark & Peacock), shared his thoughts X on the underpayment progress.

He wrote: “Good news that the govt (UK Government) has now paid back nearly half a billion in underpaid State Pensions. But still half a billion more to pay on these errors and another billion on ‘mothers missing millions’ – need to keep the pedal to the floor on fixing these errors.” (sic)

Those affected will be contacted by the DWP as soon as their case has been evaluated. The pensions department will likely send a letter confirming how much back pay a person is entitled to.

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