Mothers may be owed around £1bn in latest State Pension scandal

You may be entitled to claim money back if you received child benefit payments before May 2000 and didn’t provide your National Insurance number. You may not have provided this because it wasn’t mandatory to include NI numbers on child benefit forms before then. This means that the DWP could have made a mistake when calculating how many years of HRP you were entitled to, leaving you to receive a shortfall in State Pension payments.

At present, HMRC is in the process of finding out who may have missed out on their entitlement to HRP through their National Insurance records. It is launching a campaign this autumn to find those affected, and will write to them or their families if they’ve passed away. According to the Department of Work and Pensions, the total amount owed could range from £300m to £1.5bn, but it estimates the amount of underpayments in this particular scenario is £1.043bn.

This latest State Pension payments scandal follows a catalogue of errors by the government that has led to millions of people receiving a shortfall in State Pension payments. Read more in our article Is my State Pension being underpaid?

Previously, State Pension underpayments primarily affect married women, widows and women aged over 80 who claimed their State Pension before 6 April 2016, who do not have a full National Insurance Contribution (NICs) record, and who should have received increases in their basic State Pension.

So far, the DWP has repaid more than £300m in State Pension underpayments to women affected in this group, but there’s still an enormous amount to repay to meet its target. It’s estimated that as many as 237,000 pensioners have been underpaid around £1.46bn.

Helen Morrissey, head of retirement analysis at Hargreaves Lansdown, said: “The scale of the State Pension underpayments is staggering and has caused many thousands of people unnecessary financial distress. People have an expectation that they will receive the correct amount of State Pension at the right time and for so many people this has not been the case. The identification of Home Responsibilities Protection claimants as another group affected is disappointing.

“The DWP is to start contacting those potentially affected in the autumn but given the experience of other groups affected by underpayments we know it’s going to be a long process and many people face significant waits before receiving what they are due.

“In the case of those affected by Home Responsibilities Protection many records do not even exist anymore and so the DWP faces a laborious process of going through National Insurance records to try and identify people. There’s every chance many of those affected could continue to be overlooked and not receive what they are entitled to.”

If you think you might have received a shortfall in your State Pension payments, pensions consultant Lane Clark & Peacock has developed a useful calculator to help women identify if they have been underpaid. You simply enter a few basic details, and how much State Pension you currently each receive, and it will tell you if you are likely to be eligible for more.