HMRC error could mean DWP owes some pensioners £5,000 each

Thousands of people risk missing out on State Pension payments due to HM Revenue and Customs (HMRC) error. Former pensions minister Sir Steve Webb has highlighted how mistake could result in many older people going without cash that is rightfully theirs.

Sir Steve, now a partner at law firm LCP, has hit out at an HMRC plan to track down more than 180,000 people who did not receive National Insurance (NI) credits for time spent while raising children, saying it is likely to fail. The Department for Work and Pensions (DWP) has said approximately 187,000 pensioners have been underpaid due to NI discrepancies, as reported by Birmingham Live.

To date, HMRC has sent out more than 250,000 letters to people of State Pension age who have no Home Responsibilities Protection (HRP) on their record, encouraging them to put in a claim. However Sir Steve, has voiced his concerns, stating: "Whilst I understand the desire of Government departments to cut costs, it is completely inappropriate to write letters to hundreds of thousands of pensioners which suggest that the only way to apply is online.

"At the very least, the letters should give recipients a phone number to call or include a paper form for those who are not online. I am concerned in particular for older pensioners who may not have friends or family to help them."

He said those who have been underpaid have typically missed out on thousands of pounds, and “deserve to have this put right”.

He added: “Unless HMRC addresses this issue it is highly likely that tens of thousands of older pensioners may continue to miss out on money which is rightfully theirs.” Anyone who is affected could be owed an average of £5,000 each, with the DWP expecting to pay out more than £1bn in arrears.

The DWP estimates 43,000 of those affected are now deceased but their family will be able to make a claim for any money owed.