Corporate Adviser
  • Content Hubs
  • Magazine
  • Alerts
  • Events
  • Video
    • Master Trust Conference 2024 videos
  • Research & Guides
  • About
  • Contact
  • Home
  • News
  • In Depth
  • Profile
  • Pensions
    • Auto-enrolment
    • DB
    • DC
    • Defaults
    • Investment
    • Master Trusts
    • Sipps & SSAS
    • Taxation
  • Group Risk
    • Group Life
    • Group IP
    • Group CIC
    • Mental Health
    • Rehab
    • Wellbeing
  • Healthcare
    • Musculoskeletal
    • Mental Health
    • IPT
    • Wellbeing
    • Trusts
    • Cash Plans
  • Wellbeing
    • Mental Health
    • Health & Wellbeing
    • Financial resilience
  • ESG
No Result
View All Result
Corporate Adviser
No Result
View All Result

Budget 2021: Women owed £3bn in underpaid state pensions

by Emma Simon
March 3, 2021
Share on FacebookShare on TwitterShare on LinkedInShare on Pinterest

The government is due to refund £3bn to women who have been underpaid state pensions according to the latest documents released by the Office of Budget Responsibility.

The figures are contained in the OBR’s latest economic and fiscal outlook, which it publishes alongside the Budget. 

The size of this repayment has been described as “mind-numbing” by former pensions minister Steve,  now a partner at consultants LCP. 

The OBR document states: “The DWP identified underpayments to state pension relating to entitlements for certain married people, widows and over-80s back to 1992. Our forecast reflects an initial estimate that it will cost around £3 billion over the six years to 2025-26 to address these underpayments, with costs peaking at £0.7 billion in 2021-22”

It adds that an administration error identified in March 2020 suggested that a small number of people had been underpaid. However a fuller investigation suggests the problem may be more extensive.

The OBR document adds: “The underpayment affected married women whose husbands reached pensionable age before 2008 and who were unknowingly entitled to ‘enhanced pension’ that would have boosted their payments by up to 60 per cent. 

“DWP investigations between May and December 2020 uncovered a systematic underpayment of state pensions, meaning tens of thousands of married, divorced and widowed people may have been underpaid since 2008.”

A repayment programme began on 11 January 2021. The OBR says that the costing is subject to a “high degree of uncertainty” as the true extent of the underpayment is not yet established.

Last year Webb tabled a freedom of information inquiry to the DWP which revealed large numbers of women were getting state pensions below the expected rate.  Subsequent campaigning revealed other groups of women including widows and the over 80s may also have been affected. 

 The DWP has set up a special unit employing more than 100 civil servants to look into this issue, but today is the first time the scale of the problem has been publicly stated. 

Webb says: “This figure is truly mind-numbing.  When I first looked into this issue a year ago I had no idea it would explode into such a huge issue. 

“Repayments of £3 billion over the next five years could imply huge numbers of women have been shortchanged, potentially for a decade or more.  The government needs to devote serious resources to getting these repayments out quickly as these women have waited long enough”.

VIDEO FROM ROYAL LONDON


Find out more about how to support the switching of a workplace pension

Live Webinar Live Webinar Live Webinar

Corporate Adviser Special Report

REQUEST YOUR COPY

Most Popular

  • Aon appoints head of UK retirement

  • New endgame trade body launches

  • NatWest Cushon invests in carbon removal fund as part of ‘natural capital’ allocation

  • Barnett Waddingham appoints principal and risk transfer actuary

  • Experts warn salary sacrifice cuts risk pensions and raises employer cost

  • Is it time to rethink GIP?

Corporate Adviser

© 2017-2024 Definite Article Media Limited. Design by 71 Media Limited.

  • About
  • Advertise
  • Privacy policy
  • T&Cs
  • Contact

Follow Us

X
No Result
View All Result
  • Home
  • News
  • In Depth
  • Profile
  • Pensions
    • Auto-enrolment
    • DB
    • DC
    • Defaults
    • Investment
    • Master Trusts
    • Sipps & SSAS
    • Taxation
  • Group Risk
    • Group Life
    • Group IP
    • Group CIC
    • Mental Health
    • Rehab
    • Wellbeing
  • Healthcare
    • Musculoskeletal
    • Mental Health
    • IPT
    • Wellbeing
    • Trusts
    • Cash Plans
  • Wellbeing
    • Mental Health
    • Health & Wellbeing
    • Financial resilience
  • ESG

No Result
View All Result
  • Home
  • News
  • In Depth
  • Profile
  • Pensions
    • Auto-enrolment
    • DB
    • DC
    • Defaults
    • Investment
    • Master Trusts
    • Sipps & SSAS
    • Taxation
  • Group Risk
    • Group Life
    • Group IP
    • Group CIC
    • Mental Health
    • Rehab
    • Wellbeing
  • Healthcare
    • Musculoskeletal
    • Mental Health
    • IPT
    • Wellbeing
    • Trusts
    • Cash Plans
  • Wellbeing
    • Mental Health
    • Health & Wellbeing
    • Financial resilience
  • ESG

This website uses cookies. By continuing to use this website you are giving consent to cookies being used. Visit our Privacy and Cookie Policy.