A pensions error by the DWP could see state pensioners claim up to £40,000 in backdated payments – even if they are no longer eligible for the £300 Winter Fuel Payment.
Two historic underpayments of state pension benefits largely affecting women have been unearthed thus far which could be worth as much as £40,000 per person.
The Department of Work and Pensions is still working through the process of identifying underpayments to women whose husbands have died.
But many women never inherited the pension they were entitled to when their husband died, and could be owed tens of thousands.
Pensions and finance firm LCP is helping women claim back what they’re owed from a new error identified relating to women who were already widowed when they retired and did not inherit their late husband’s pension entitlement.
Former pensions minister and LCP partner Steve Webb said: “These are people claiming the new state pension *who were already widowed* when they retired.
“He has recently been contacted by four separate people who had not been awarded any inherited state pension when they retired and had been told in writing or over the phone by DWP that they were not entitled. In all four cases, this was incorrect. An increased amount of state pension has been put into payment and arrears have been paid.”
The group most affected are those who are widows or widowers at the point when they claim their new state pension and where either: the late spouse reached pension age before April 6, 2016 or the late spouse died before April 6, 2016
In this case, the widow or widower can potentially inherit at least 50% of any ‘additional state pension’ which the late spouse built up, plus 50 percent of any ‘Graduated Retirement Benefit’.
Steve Webb added: Having had to spend years checking hundreds of thousands of historic state pension calculations for errors, you would hope that DWP would be making sure that new claims are handled correctly.
“But we have found worrying evidence that this is not the case. There seems to be a particular problem for people who are widows or widowers when they claim their state pension.
“In some cases DWP seems to have failed to automatically add any inherited state pension they were due from a late partner. These cases may well be the tip of an iceberg, with many thousands of people potentially underpaid. The Department needs to launch an urgent investigation into the scale of this problem. In the meantime I hope that our new online tool will help people to check what they are entitled to and to report any errors.”
It comes after the Winter Fuel Allowance payments were changed to make the elibility criteria for the £300 Winter Fuel Payments much stricter. Regardless of your eligibility for the payment now – which requires you to be able to claim a ‘qualifying benefit’ to get it – the error could see you claim tens of thousands.
