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MPs demand answers for elderly women in £3bn state pension scandal


Stephen Timms MP:  Chairman of work and pensions committee has asked DWP to explain how it is prioritising payouts to elderly women

MPs have demanded the Government reveals how it plans to prioritise £3billion of state pension backpayments to elderly women, and make contact with heirs of those who have died.

An estimated 200,000 women are affected by a scandal stretching back decades, which was uncovered by former Pensions Minister Steve Webb and This is Money,  

Details about whether payments will be made in order of age, amount owed, or to claimants who are still alive first, are being called for by MPs on the work and pensions committee.

They also highlighted the Department for Work and Pension’s woeful record on answering the phone – with just over half of calls getting through during a period last autumn – and asked if there will be a separate contact number set up for underpaid women.

The state pension debacle results from a failure to increase some women’s payments when their husbands reached state pension age or died, or when they themselves reached the age of 80.

Read more here on how to find out if you were underpaid, and what to do. 

Stephen Timms, chair of the work and pensions committee, has asked how far back the Department for Work and Pensions will be checking records in its correction exercise, and whether divorced people will be included.

In a letter to current Pensions Minister Guy Opperman made public today, he called for an explanation on why promised information about the amount of arrears paid so far and the number of people who have received repayments has not yet been issued.

And he questioned whether figures about the scale of the problem had been given to the press, but not yet shared with parliament.

His letter asks: ‘In what order of priority is the Department investigating cases? For example, are you giving any priority by age, by the size of the underpayment, or to claimants who are still alive?’

Guy Opperman:  He recently revealed 155 staff are working to correct the payments of an estimated 200k married women, widows and over-80s

Guy Opperman:  He recently revealed 155 staff are working to correct the payments of an estimated 200k married women, widows and over-80s

He goes on: ‘It is sadly inevitable that some people who have been underpaid have already died, and others will die in the six years that this process is expected to take. 

‘In such cases, how will you go about contacting the estate of the person who has died? Do you hold reliable contact details?’

This is Money understands that in processing cases, the DWP is prioritising errors that are the longest standing and recipients who are older to reduce the time these women have to wait.

Meanwhile, those who contact the DWP themselves to query their state pensions will continue to have them reviewed. There is a new phone menu option for women who have been underpaid if you ring 0800 731 0469.

The DWP has confirmed that deceased women who were underpaid will have arrears paid to their estate, so it will go to their beneficiaries.

This is Money has heard no information on how such claims will be dealt with or when, and what information is required.

However, the executor or administrator of a will could ring or write to the DWP and give the personal details listed here about the deceased, plus their own contact details. 

Timms, who has asked for a response to his 11 questions (see below) by 8 April, notes in his letter that women who are unable to get through to the DWP in recent months have been contacting Steve Webb direct instead.

Pick up rate for calls to the DWP about the state pension in late 2020

Performance statistics for the percentage of calls answered by the state pension telephone line (Source: DWP)

Performance statistics for the percentage of calls answered by the state pension telephone line (Source: DWP)

Webb, now a partner at consultant LCP and This is Money’s pension columnist, says: ‘It is estimated that the DWP is going to be spending billions of pounds of public money and making payments to hundreds of thousands of people.

‘We have a right to know a lot more about how this is going to be done, including who is included in this exercise, who they will be contacting first and what they will do if someone has already died.

‘The Department has given very little information about this and has even brushed away questions in Parliament.

‘This is not good enough so I very much welcome the fact that the select committee has written this letter and is holding the Department to account.’ 

MPs demand answers on underpaid state pension: Their full list of questions to the minister

1. Why has the Department not answered questions about the amount of arrears paid so far and the number of people who have received repayments? When do you expect to publish that information?

2. When do you next expect to update Parliament? How often do you then expect to update Parliament after that?

3. What information do you expect to be able to provide in your future updates?

4. It has been reported in the press that “around 200,000” women will receive letters from the Department to tell them that their state pension has been underpaid. Is the Department the source of that figure? If so, why has it not been shared with Parliament?

5. Will you share with the Committee a template of the letter that is being sent?

6. What progress has the Department made on this since your statement?

7. Are divorced people within the scope of your exercise?

8. In what order of priority is the Department investigating cases? For example, are you giving any priority by age, by the size of the underpayment, or to claimants who are still alive?

9. It is sadly inevitable that some people who have been underpaid have already died, and others will die in the six years that this process is expected to take. In such cases, how will you go about contacting the estate of the person who has died? Do you hold reliable contact details?

10. Given the difficulty with making calls to the State Pension telephone line, will there be a separate contact number for people affected by this exercise?

11. How far back will the Department be checking records? 

What does the DWP say?

‘The action we are taking now will correct the historical underpayments that have been made by successive governments and anyone impacted will be contacted by us to ensure they receive all that they are owed,’ said a spokesperson for the DWP.

It previously told us: ‘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.’

It added that married women who are already getting a state pension are required to make a separate claim to have it increased if their husband reached state pension age before 17 March 2008.

A claim is not needed if their husband reached state pension age from 17 March 2008 onwards.

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

Read the DWP’s full statement on underpaid state pension here. 

TOP SIPPS FOR DIY PENSION INVESTORS

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