More people than previously thought have been underpaid their state pension.
New figures from the Department for Work and Pensions (DWP) estimate that 237,000 state pensioners, primarily women, received less than their full entitlement due to an issue dating back to 1985.
When the DWP estimated the scale of the issue a year ago, they believed 132,000 state pensioners were affected.
The new estimate brings the likely total of state pension underpayments to around £1.5 billion.
State pensioners who failed to receive the full amount due include widows and divorcees.
The issue arose because married women with a smaller state pension entitlement could claim a 60% state pension based on their husband’s National Insurance contribution record. However, a system error meant the DWP did not automatically apply this increase.
Some state pensioners who received less than their entitlement will eventually receive compensation to make up payments to the full amount. Others will only receive 12 months of underpaid pension.
Publishing the new estimates, the National Audit Office said:
“DWP has carried out additional reviews of its records to understand the pensioners that may be affected, but the full extent of the underpayments will not be known until every case has been reviewed.”
Earlier in the year, the Public Accounts Committee of MPs referred to the situation as a “shameful shambles”, saying in a report that the errors were due to out of date systems and reliance on manual processes.
A DWP spokesman said:
“The action we are taking now will correct historical underpayments made by successive governments. We are fully committed to addressing these errors, not identified under previous governments, as quickly as possible.”
He added that a dedicated team at the DWP, which has “significant resources”, is working on the exercise.
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