130,000 Pensioners Owed Millions After DWP Error

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The Department for Work and Pensions (DWP) has identified over £800 million in state pension underpayments as part of an ongoing correction exercise that began in January 2021.

Between January 11, 2021, and March 31, 2025, the DWP uncovered 130,948 cases where pensioners were owed a total of £804.7 million.

Those affected include married women on low state pensions whose payments were not automatically increased when their partners retired, individuals whose pensions were not reassessed after the death of a spouse, and over-80s who missed out on automatic pension increases.

The DWP noted that “cases may be checked for more than one potential cause of error,” meaning some claims fall into multiple categories.

Sir Steve Webb, former Liberal Democrat pensions minister and partner at consultancy LCP, highlighted the scale of the issue: “The vast majority of those who lost were women, some of whom were underpaid for decades or even went to their grave never paid the right state pension.

The remaining corrections need to be handled as a matter of urgency. This should never be allowed to happen again.”

Rachel Vahey, head of public policy at AJ Bell, described the situation as “one of the biggest benefit scandals of modern times,” emphasizing that “it is absolutely critical all those affected by this scandal receive the money they are owed as quickly and efficiently as possible.”

The DWP has also been conducting a separate correction exercise addressing missing historic periods of Home Responsibilities Protection (HRP), which has identified further underpayments totaling around £42 million between January and September 2024.

Sir Steve Webb warned that payments under this HRP exercise “are expected to rise sharply as it gathers momentum.”

A DWP spokesperson stated: “Our priority is ensuring pensioners receive the dignity and security they deserve in retirement and that state pension underpayment rates remain as low as possible.

We have now completed the vast majority of cases in the exercise as planned with a small number of outstanding cases due to further documentation needed from the customer.”

Pensioners who believe they may be affected are encouraged to check their entitlement and contact the Pension Service for assistance.