Tens of thousands of UK pensioners are now discovering they may have been underpaid by the Department for Work and Pensions (DWP) — with total underpayments reaching a staggering £804.7 million. Since the DWP launched a review in January 2021, over 130,000 pensioners have been affected, some missing out on as much as £12,000 each.
The issue, largely driven by outdated systems and administrative errors, has hit some of the most vulnerable groups: married women, widowed individuals, and those over 80. With the review ongoing and payments still being corrected, it’s crucial for pensioners and their families to take action now.
The Scale of the Underpayments
Between January 2021 and March 2025, the DWP uncovered 130,948 cases of underpayments totaling £804.7 million. These errors stem from:
- Failing to automatically update pensions after key life events (like a spouse’s death)
- Neglecting to apply certain entitlements for older individuals
- Mismanagement of Home Responsibilities Protection (HRP) for carers and parents
Tragically, some affected pensioners have already died — meaning these funds may never be claimed or returned to their estates.
Who Has Been Affected?
The underpayment scandal primarily affects three groups:
1. Married Women (Category BL)
- Issue: Their pensions weren’t increased to 60% of their husband’s basic state pension when he reached retirement age.
- Average owed: £5,553
- Many of these women stayed underpaid for years without knowing they were entitled to more.
2. Widowed Pensioners
- Issue: Their pensions weren’t correctly recalculated after their spouse passed away.
- They were often due a portion of their late spouse’s pension, which never arrived.
- Average owed: £11,725
3. Individuals Over 80 (Category D)
- Issue: Those over age 80 didn’t receive the automatic top-up they were entitled to under pension rules.
- Average owed: £2,203
In some cases, individuals fall into more than one group, significantly increasing the arrears.
Additional Underpayments: Home Responsibilities Protection
A separate issue involves HRP, a scheme meant to protect pension rights for carers or parents who took time off work. As of September 2024, around 5,344 people were identified as having been shortchanged, with £42 million in arrears.
Estimated Arrears by Group
| Group | Average Arrears |
|---|---|
| Widowed Pensioners | £11,725 |
| Married Women (Cat BL) | £5,553 |
| Individuals Over 80 (Cat D) | £2,203 |
| HRP Cases (Carers/Parents) | Varies (est. £7,800 avg) |
Push for Accountability and Reform
Former pensions minister Sir Steve Webb—who helped expose the issue—has called for swift compensation and a full overhaul of the system. He described the DWP’s failures as “shocking,” especially given that some pensioners were underpaid for decades or passed away without ever being reimbursed.
Financial analyst Rachel Vahey labeled the scandal “one of the biggest benefits blunders in recent history,” and emphasized the need for fast, transparent redress.
What Has the DWP Said?
In response to public pressure, the DWP has:
- Acknowledged the severity of the problem
- Committed to reviewing all identified cases
- Claimed that most cases have now been corrected, though some complex claims remain under review
They also encouraged pensioners who believe they were underpaid to come forward, especially if they meet the criteria listed.
What Should You Do?
If you believe you, your partner, or a family member may be affected:
Steps to Take:
- Review your pension records — especially if you’re a woman who retired before April 2016, a widow, or over age 80.
- Contact the DWP Pension Service directly to request a review.
- Gather documentation — such as your spouse’s pension details, death certificates, or proof of age.
- Seek help from Age UK or Citizens Advice if you need assistance.
Note: You don’t need to repay any money the DWP sends if they confirm you were underpaid — it’s yours by right.
FAQs
How do I know if I’ve been underpaid?
Check if you fall into one of the affected groups and contact the DWP Pension Service for a formal review.
Can my family claim if a relative passed away?
Possibly. The DWP reviews each case individually. If the estate is still open, reimbursement may be possible.