Around 134,000 retirees have been paid less state pension than they deserve after a series of errors by the Department of Work and Pensions, which might not be able to track down everyone it owes money to
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Retirees have lost out on £1billion due to government failures with the state pension – and retired people can check to see if they have been affected personally.
Back-to-back human errors, complex rules and outdated IT systems meant people faced hardship and lost out on money they had worked their entire lives for, the National Audit Office (NAO) said this week .
The Department for Work and Pensions (DWP) estimates that it underpaid 134,000 pensioners and those it can trace will be paid an average of £8,900 back .
Most of those affected are likely to be women and the true value of the underpayments will only become clear once the Department for Work and Pensions has completed its review of all cases, the watchdog added.
Were you underpaid on your state pension? Get in touch: email@example.com
How to check if you were underpaid the state pension
You can check how much you are being paid by monitoring your bank account or annual state pension statement.
If you think you might have been short-changed out of your pension, you can use an online tool to check here .
The tool asks a few simple questions that let you know if you have been affected and could be due some money back.
It was made by consultants Lane, Clarke and Peacock, who first uncovered this issue.
What went wrong with state pension payments?
The problem happened because state pension rules are unnecessarily complex and DWP IT systems are outdated and unautomated, according to the NAO.
The auditors added that administering claims needed a high degree of manual review and understanding by case workers.
“This makes some level of error in the processing of state pension claims almost inevitable,” the NAO added.
Caseworkers often failed to set and later action manual IT system prompts on pensioners’ files to review payments at a later date, such as for when people reached state pension age or their 80th birthday, it said.
Frontline staff found instructions difficult to use and lacked training on complex cases, according to the findings.
The Department still does not have a means of reviewing individual complaints or errors, such as how many people are complaining about the same issues, to assess whether the errors have a systemic cause.
Quality assurance processes focused on checking changes to case details, such as a change of address or the death of a spouse, rather than the overall accuracy of the payments, the NAO continued.
The DWP does not know how many pensioners who have died have been underpaid as, for data protection reasons, it does not usually keep records for more than four years after a pensioner’s death, and if married, their spouse’s death.
The government department is now prioritising individuals who fall into “at risk” categories, such as those who are widowed or aged over 80.
Gareth Davies, the head of the NAO, said: “The impact of the underpayment of state pension on those pensioners affected is significant.
“It is vital that the Department for Work and Pensions corrects past underpayments and implements changes to prevent similar problems in future.”