The Department for Work and Pensions (DWP) has issued a statement after new analysis revealed that over a million pensioners were underpaid last year.
Processing errors meant that 10.7% of all State Pension cases were underpaid, with around 1.3 million pensioners affected by the mistakes. People on State Pension were underpaid a total of £530 million last year, averaging more than £400 per person, amid the cost of living crisis.
The figures were unearthed in official Government documents about fraud and error in the benefits system, which said that mistakes made by government officials cost benefits and state pension claimants £1.1 billion in the 2021-22 financial year. The Express reported that the significant underpayments were discovered because the Government is now actively carrying out checks, rather than using estimates, suggesting that underpayments could have been much higher in previous years.
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The data also revealed that £140 million was underpaid to Universal Credit claimants in the same period, while those on Employment and Support Allowance were left £130,000 short. Around 1.8 million people were affected by underpayments overall.
Former pensions minister Sir Steve Webb said of the figures: "It's an extraordinary amount of money to miss out, especially during a cost of living crisis. It is all the more shocking that proper checks have not been done for more than 15 years.
"These figures are the first year that checks have been done properly - they've actually been phoning people up - and unsurprisingly the underpayments are very high."
Helen Morrissey, head of retirement analysis at Hargreaves Lansdown, also hit out at the mistakes. "When people claim benefits there is an expectation they will be paid the correct amount," she said.
"Even though underpayments due to official error looks low in percentage terms the reality is that it amounts to a huge amount of money that is not being sent to people who sorely need it. The issue of state pension underpayments has been reported widely in the press, with the National Audit Office estimating well over 100,000 people, primarily women, not receiving what they are due.
"The Government is in the midst of identifying and repaying those affected but the reality is this is going to take some time and many people have struggled financially as a result. The benefits system is hugely complex and difficult to navigate. It is to be hoped Government learns lessons from the State Pension issue to ensure underpayments throughout the benefits system are identified and remedied more quickly."
A spokesperson for the Department for Work and Pensions said: "State Pension underpayment rates remain low at 0.5 percent of expenditure.
"In 2021/22 we spent over £104 billion and in 2022/23 we were forecast to spend over £110 billion on the State Pension, supporting over 12.5 million pensioners. Our priority is ensuring everyone receives the financial support to which they are entitled and, where errors do occur, we are committed to fixing them as quickly as possible."
It comes after separate DWP figures last month revealed that tens of thousands of state pensioners have received a total of £300 million after being underpaid. Of the 173,538 accounts checked between January 11, 2021 and February 28, 2023, exactly 46,716 underpayments were identified - equating to around £6,420 on average per case.
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FAQs
In 2023, Citizens Advice helped 17,090 people with benefit overpayments. In the past, the DWP would pick up the tab if it made the mistake, but now claimants are often expected to pay. This can leave households facing years of debt and having money taken from their benefits, all because of a DWP mistake.
Why did I not get the pension increase? ›
If you took early retirement (not including ill health) and are under 55 years old, you do not get increases until your 55th birthday. We will write to you shortly before your 55th birthday to tell you about the increase to your pension.
Why are DWP saying I owe them money? ›
If you've been paid too much by mistake
For example, if you were overpaid because they: made a mistake when calculating your payments. didn't correctly record your information or any change of circ*mstances you told them about. didn't put right a mistake you told them about.
How many years can DWP claim back? ›
you or anyone else owing the money (if your debt is in joint names) have not made a payment towards the debt during the last six years; and. you or anyone else owing the money (if your debt is in joint names) have not written to the DWP admitting you owe the debt during the last six years.
Can Social Security make mistakes on benefits? ›
Reasons for Improper Payments
Improper payments also occur when SSA makes mistakes in computing payments due to the complexity of calculations and reliance on manual processes. SSA administers the Old-Age, Survivors and Disability Insurance (OASDI) and Supplemental Security income (SSI) program.
How do you fight DWP? ›
If you want to appeal a benefit decision you must ask the Department for Work and Pensions (DWP) or HM Revenue and Customs (HMRC) to look at their decision again first. This is called asking for mandatory reconsideration.
How do I find out if my State Pension is correct in the UK? ›
To get information about your State Pension, contact the Pension Service if you're in the UK or the International Pension Centre if you live abroad.
How much does a widow get of her husband's State Pension? ›
If the widowed spouse reaches state pension age under the new system and their late spouse the old one, the former would inherit 50-100 per cent of the latter's additional state pension or Serps (see the table above) but not any of their basic state pension.
Will the State Pension be scrapped in the UK? ›
The answer to this question isn't set in stone yet, but there have been rumours about the State Pension being abolished for several years. Back in 2018, the Government Actuary's Department (GAD) estimated that the UK's increasingly ageing population could drive the State Pension fund to run dry by 2033.
Can DWP look at my bank account? ›
Under current rules, DWP can only request details of a bank account holder's transactions if there are reasonable grounds to suspect them of fraud.
The DWP can ask the executor to provide detailed financial information. This will include bank statements and savings accounts. They can request information as far back as 12 years. Once they have made their initial assessment they also has the right to request further information if they need clarification.
How far back can social security go for overpayment? ›
The Social Security Administration (SSA) recently removed a bar on recovery of old overpayments ten years or older.
Does DWP back pay? ›
Previously, some claimants received lower payments or were denied PIP altogether due to insufficient points in the assessment. However, a 2019 court ruling rectified this discrepancy, prompting the DWP to reassess and issue back payments to those affected.
Can you send a letter to DWP? ›
You can also write to DWP . Include a description of the information you want (for example Jobseeker's Allowance records), the time period you need the information to cover and your: full name. full address.
Can DWP recover overpayments? ›
The Secretary of State has an obligation to protect public funds and to ensure that, wherever possible, overpayment and penalty debt is recovered. Overpayment recovery is subject to various legislative limitations and safeguards. It is DWP policy to recover all debt where it is reasonable and cost effective to do so.
What happens if you disagree with a decision made by DWP? ›
If you don't agree with a benefit decision, you can challenge it. To do this, you need to ask the Department for Work and Pensions (DWP) or HM Revenue and Customs (HMRC) to look at their decision again. This is called asking for a 'mandatory reconsideration'.
What triggers a DWP compliance check? ›
Home Visits: DWP compliance officers may visit a claimant's home if there is a concern about their eligibility for benefits or to verify information provided on their claim. A home visit can be triggered if a claimant has a history of fraud or non-compliance, or if inconsistencies have been identified in their claim.
How do I challenge a DWP decision? ›
About DWP's decisions
You can find what form to use at: www.gov.uk/appeal-benefit-decision. In most cases, before you can appeal to the tribunal, you must ask for the decision about your benefit to be looked at again. This is called 'mandatory reconsideration'.
How do I know if a DWP letter is genuine? ›
Any letters and forms will have the Jobcentre Plus or Department for Work and Pensions ( DWP ) logo. Contact Jobcentre Plus if you're claiming: Employment Support Allowance (ESA) Incapacity Benefit.
