State Pension underpayments: are you owed money?

04 March 2024

Written by Retirement Line Updated: 15th January 2025

The State Pension is a safety net for many of us, providing a reliable income to millions of pensioners after spending our lives working, raising a family or both. However, thousands of people have been affected by State Pension underpayment issues. 

Significant underpayment issues have come to light, affecting thousands of pensioners, predominantly women. As of September 2024, the Department for Work and Pensions (DWP) had identified 119,050 underpayments, amounting to a total of £736 million owed. With the checking process not yet over, it is expected many more are yet to receive their money.

Following a lengthy government review, many thousands of letters are being sent out from HMRC to the individuals eligible for back payments. It has been found that these are mostly women who spent years at home to look after their children.

In this article we’ll explain the various groups who have been impacted by the errors, and how to find out if you are due a refund.

How did the State Pension underpayments come about?

Many underpayment cases came about due to a DWP IT failure.

In 2020, the Department for Work and Pensions (DWP) discovered that some individuals had not received the automatic increases to their State Pension as required by law. This revelation led the department to launch an investigation into the scale of the issue.

State Pension underpayments fall into three main categories:

• Cases addressed through the State Pension Underpayments (LEAP) exercise

• Home Responsibilities Protection (HRP) cases where HRP was not correctly recorded on National Insurance records

• Instances where National Insurance credits need updating for individuals who were receiving Universal Credit.

It is mostly women who have been receiving less money and the issue dates back as far as 1985.

Credits for their time at home with children may not have been linked from the Child Benefit system to the National Insurance system. The financial impact on mothers who spent many years at home raising their children could be substantial.

In an attempt to rectify the mistakes, the DWP began the enormous task of correcting this error in January 2021. This is known as the Legal Entitlements and Administrative Practices (LEAP) process.

Which groups of pensioners have been underpaid?

Hundreds of thousands of parents, widows, widowers, over-80s and divorcees have received less State Pension than they should have.

The list of people who now require back payments is broad. It includes married women whose husbands reached State Pension age before 2008; plus widows and widowers who may have been underpaid either during or after their spouses’ lifetime.

If you fall into one of the following categories then the government should pay your top-up automatically as it continues to work through its review:

• Married women who reached State Pension age before April 2016, with husbands who were aged 65 on or after 17 March 2008 - if the women’s State Pension is less than 60% of their husband's basic State Pension.

• Widows whose pension didn't increase when their husband died - if the widow reached State Pension age before April 2016, and who received less than 60% of their husband's basic State Pension while he was still alive.

• Widows who may have been underpaid since their husband died. 

• Women aged 80+ receiving less than £80.45 per week in State Pension.

• The heirs of somebody who was underpaid State Pension in their lifetime but has since died.

However, some people need to put a claim in to get their pension top-ups. These include women who:

• Reached State Pension age before April 2016 and their husband turned 65 before 17 March 2008. 

• Are divorced and should have benefited from their ex-husband's national insurance record.

You can get more information here on these and other categories that may mean you are eligible for a top-up.

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How much has been paid out so far?

The Department for Work and Pensions (DWP) has now completed its LEAP reviews for married individuals and those aged over 80. It said in September that it was on track to complete the widowed cases by the end of 2024, and that payments totalling £736 million had been made as follows:

Married women cases: Latest figures from the government show that a total of £250.6m has been repaid so far to the 45,907 cases involving married women. These average £5,591 in back payments per case. 

Over-80s: This group has had £68.2m repaid so far, with average payments of £2,202.

Widows: A total of £417.2m has been paid to women in this category so far, averaging £11,905 per payment.

Meanwhile, a similar effort by HM Revenue and Customs (HMRC), focusing on Home Responsibilities Protection (HRP) corrections, uncovered an additional 5,344 cases of underpayment between 8 January 2024 and the end of September 2024. According to the Daily Record, the average amount owed to individuals under this scheme was £7,859.

The DWP estimates it underpaid between £300 million and £1.5 billion of State Pension solely because of errors with the recording of HRP.

Speaking previously about the money being paid back to pensioners, former Pensions Minister Steve Webb, stated: 

“The process of correcting state pension errors began nearly three years ago but still only around half of the money has been paid so far.

“Worse still, when DWP recently decided to do the first proper checks on State Pensions in years, they identified another £1bn in underpayments and work has barely begun on fixing those errors. DWP still has a mountain to climb when it comes to paying all pensioners the amount they are due.”

How can I find out if I am owed State Pension underpayments?

If you are identified in the LEAP correction process then the DWP will send you a letter to inform you of the automatic changes to your State Pension.

However, not everybody who is owed money from the State Pension underpayments will receive their top-ups automatically, so you might want to contact the Pension Service to check.

For more information visit the Pension Service online or call 0800 731 0469.

Or write to:

The Pension Service

Post Handling Site A

Wolverhampton

WV98 1AF

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