Money Saving Expert Martin Lewis has issued a critical alert, highlighting that tens of thousands of women across the UK may be significantly underpaid on their state pensions. The warning primarily targets married, divorced, and widowed women who reached state pension age before April 2016, with some individuals potentially owed more than £100,000 in arrears.
This widespread issue stems from historical errors in the way the Department for Work and Pensions (DWP) calculated state pension entitlements for certain groups of women. Many women were not automatically awarded increases in their pension based on their husband's National Insurance contributions, a provision that should have been applied under the old state pension rules. The DWP has acknowledged the problem and has been working to identify and correct these underpayments, but many cases still remain outstanding.
The underpayments predominantly affect three main categories of women. Firstly, married women whose husbands reached state pension age before March 17, 2008, and who were not automatically upgraded to a 60% state pension rate based on their husband's contributions. Secondly, widowed women who may have inherited less than their full state pension entitlement from their deceased husband. Lastly, divorced women who did not have their state pension recalculated following their divorce, which could have increased their entitlement based on their ex-husband's National Insurance record.
While the DWP has been proactively reviewing cases, it is estimated that many women are still unaware they are missing out on substantial sums. Martin Lewis has urged all women who believe they might be affected to check their state pension statements carefully and, if in doubt, to contact the DWP directly. The process for claiming involves contacting the DWP's dedicated correction team, who can review individual cases and process any arrears owed.
The implications of these underpayments are significant for thousands of households, potentially providing a much-needed financial boost in a period of high living costs. For some, the arrears could represent a life-changing sum, impacting their financial security in retirement. The UK Government, through the DWP, has committed to addressing these errors and ensuring all eligible individuals receive their correct entitlements, underscoring the importance of public awareness campaigns like those spearheaded by Martin Lewis.