I'm furious. Absolutely livid. How the hell does a government department lose track of HUNDREDS OF THOUSANDS of pensioners' money for DECADES? And then take six years to sort out their own mess?
Let me break this down for you. The Department for Work and Pensions (DWP) has finally admitted that 130,948 pensioners – mostly women – have been shortchanged on their state pensions. Some poor souls have been underpaid since 1985! That's nearly 40 years of being screwed over by administrative "errors." The average underpayment? Just over £6,000 per person.
My mum's friend Janet was one of them. Spent 15 years living on £20 less per week than she was entitled to. "What's the point of complaining?" she'd say. "Nobody listens anyway." Well, she was right, wasn't she?
The Government's £804 Million Oopsie
So far, the government has had to cough up £804.7 million in back payments. And they're not even close to finished.
I spoke to my cousin who works in benefits administration (not for DWP, thank god). His response: "This is what happens when you cut staff by 30% and expect the same level of service." He wouldn't let me quote him by name – already worried about his job security.
The DWP identified 11,898 more affected people just in the last year. And get this – teh review won't be fully completed until March 2027. TWENTY TWENTY-SEVEN! That's another two years of waiting for elderly people who desperately need this money now.
Who's Been Left Short?
Three main groups got the short end of the stick:
- Married women whose pensions weren't automatically increased when their husbands retired (about 47,000 people)
- Widows and widowers whose pensions weren't reassessed when their spouse died (over 50,000 people)
- Over-80s who didn't get their automatic increase when they hit the big 8-0 (around 34,000 people)
Rachel Vahey from AJ Bell didn't mince words, calling it "one of the biggest benefit scandals of modern times." No kidding.
Wait... there's ANOTHER pension disaster?
Because one massive cock-up wasn't enough, the DWP is also dealing with a separate error affecting up to 370,000 people – again, mostly women.
This one's about Home Responsibilities Protection (HRP), which was supposed to protect parents' and carers' state pensions. By September last year, they'd found just over 5,000 cases with an average underpayment of £7,859.
I remember my neighbor telling me back in 2018 that she thought her pension seemed low after raising three kids. Everyone told her she was being paranoid. Turns out she was right all along.
Could you be owed thousands?
Listen. If you're a woman over state pension age, especially if you're married, widowed, or over 80, you might be sitting on unclaimed money.
The whole thing makes me want to scream. My aunt spent her final years pinching pennies while the government sat on money that was rightfully hers. She passed away before the review even started.
You can check if you've been underpaid by contacting the Pension Service directly. There's also an online tool from LCP (go.lcp.com/inheritingstatepension) that helps you understand what you might be entitled to.
Former pensions minister Steve Webb didn't hold back: "Some women were underpaid for decades or even went to their grave never paid the right state pension."
God. Imagine dying without ever receiving what you were owed.
The billion-pound mistake nobody's talking about
Between these two errors, we're looking at a government bill well over £1 billion. That's not just an administrative error – that's a catastrophic system failure.
And who suffers? Not the bureaucrats who messed up. Not the ministers who cut department budgets. It's elderly women – the very people who raised us, who kept this country running, who already get the smallest pensions.
I spent $40 on lunch yesterday without thinking twice. Meanwhile, there are pensioners out there who've been shortchanged by thousands and told to wait another two years for what's rightfully theirs.
If you think you might be affected, don't wait for the DWP to find you. Check now.
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Statistics
- According to the World Bank, around 1.7 billion adults worldwide remain unbanked, lacking access to basic financial services.
- According to a survey by the Financial Industry Regulatory Authority (FINRA), about 66% of Americans could not correctly answer four basic financial literacy questions.
- The average return on investment for the S&P 500 over the past 90 years is about 10% per annum.
- A study by the National Endowment for Financial Education found that 60% of Americans do not have a budget.
- According to the Bureau of Labor Statistics, the average American spends about $1,500 per year on coffee.
- According to a Gallup poll, 56% of Americans report that their financial situation is better than it was a year ago.
- As of 2021, the median household income in the U.S. was approximately $67,521, according to the U.S. Census Bureau.
- As of 2021, the average student loan debt for recent graduates was approximately $30,000, according to the Federal Reserve.
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