State pension: Guy Opperman says SNP are ‘misguided’
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The Department for Work and Pensions (DWP) revealed earlier this year that 134,000 pensioners have missed out on the full amount they are entitled to through the state pension. According to the DWP, the majority of the people affected by this massive error were women. Overall, around £1billion of peoples’ state pension entitlement has been underpaid, with certain errors going back as far back as 1985.
Since January 2022, the DWP has started the proceedings to rectify its past errors and mistakes.
The mistake happened because of the DWP’s use of outdated systems and heavily manual processing.
These minuscule errors were not recognised each time and snowballed over the following years leading to many people losing access to their full state pension.
The DWP will only contact state pensioners if their investigations find they have been underpaid.
On top of this, the department warned that pensioners “risk missing out on significant sums”, with “little guidance for those currently claiming State Pension who are concerned that they have been underpaid” and people left “in the dark over their entitlement”.
In light of this shocking series of errors, financial experts have slammed the situation as “scandalous”.
Tom Selby, the head of retirement policy at AJ Bell, outlined the extent of the damage done by the DWP underpayment error.
Mr Selby explained: “It is scandalous that so many pensioners, mainly women and some of whom will have been struggling to make ends meet, suffered as a result of the DWP’s stone age administration processes.
“An estimated 134,000 are thought to have missed out on over £1 billion in state pension income as a result of the errors, meaning they should be due compensation of around £8,900 each on average.”
However, the pensions expert highlighted that many of the pensioners who would have otherwise been eligible for this £8,900 payday have since passed away.
He added: “Sadly, an estimated 40,000 of those who should have been in line for a payout are thought to have died before the issue had been resolved.
“It is truly tragic that some of these people may have been unnecessarily living in penury during their final years.
“Clearly the priority for the DWP has to ensure those affected receive the money they are owed as quickly as possible.
“Once that exercise is complete, a proper review should take place to ensure mistakes like this never happen again.”
Speaking previously to Express.co.uk, a DWP spokesperson said: “Resolving the historical State Pension underpayments that have been made by successive governments is a priority for the Department and we are committed to doing so as quickly as possible.
“We have set up a dedicated team and devoted significant resources to processing outstanding cases, and have introduced new quality control processes and improved training to help ensure this does not happen again.
“Those affected will be contacted by us to ensure they receive all that they are owed.
“We are carefully considering the content of the Public Accounts Committee’s report and will respond formally in due course.”
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