“New DWP figures reveal state pension underpayments hit record levels” – Steve Webb

The latest annual statistics on benefit fraud and error from DWP, published today (11th May), show that underpayments of state pensions have reached record levels. According to the latest statistics, the total amount underpaid in 2022/23 was £670m compared with £540m in the previous year. Even more shockingly, DWP says that 6 in every 100 *new* claims to state pension were underpaid in 2022/23.

DWP says that the main sources of underpayment were:

• historic errors, meaning that married women on a low pension did not get an automatic increase when their husband retired or that married women did not get their pension reassessed when their husband died;
• errors recording ‘credits’ for time at home with children (known previously as ‘Home Responsibilities Protection’).

DWP also reported that some state pensions were overpaid, with a total overpayment of £100m in 2022/23. This means that underpayments were more than six times as large as overpayments.

Commenting, Steve Webb, partner at LCP said:

“The continuing scale of state pension underpayment is truly shocking. Whilst it is right that there is a focus on fraud in the benefit system, DWP should be equally concerned where it is not paying people what they are entitled to. What is particularly alarming is that these errors are not just historic problems, with 6 in 100 new pension claims being underpaid. Urgent action is needed to drive up standards of administration so that pensioners can have confidence that the pension they are being paid is correct.”