Sep 22, 2021

Catalogue of errors led to £1bn of state pension underpayments

The National Audit Office said 134,000 pensioners, mostly women, were underpaid pensions because outdated computer systems led to mistakes. The report raises huge questions for the Department for Work and Pensions over the way the state pension system functions and the mistakes that led to such a massive shortfall in payments. The problem relates to the "old" state pension system where married women who had a poor pension in their own right could claim a 60% basic state pension based on their husband's record of contributions. The DWP is expecting to pay the affected pensioners it can trace a total of £1.05bn, at an average of £8,900 per pensioner affected. The department is facing a heavy workload, with increased benefits claims during the pandemic, as well as a backlog in state pension applications which has meant thousands of newly-retired people have yet to receive their first state pension payments.

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