DWP gives elderly woman £9,800 state pension payout BY MISTAKE

A 73-year-old woman who was battling to win more than a decade’s worth of underpaid state pension has been handed £9,800 in a shock blunder by the Government.

Kathleen Brennan will not be asked to return the money she was given as a result of administrative error, the Department for Work and Pensions has confirmed. 

But it is sticking to its guns and refusing to make full payouts to any other women in the same position as the retired school caterer from the West Midlands.

Mrs Brennan had just lodged a complaint with the Parliamentary Ombudsman when the large sum landed in her bank account.

She had previously only received a 12-month backpayment of £1,300, despite the Government underpaying her for 13 years. 

Tens of thousands of women are owed a fortune in lost state pension in a scandal uncovered by This is Money.

We have reported on underpayments owed to married women totting up to around £112,00 in the past few months, and two cases involving widows who received £115,000 and £117,000 respectively.

But while some women are fully repaid, others are only getting a one-year backpayment and increased state pension going forward.

This all rests on whether their husband was born before 17 March 1943, and if they reached reached state pension age before him – see the box below. 

Mrs Brennan has now got a payout, though only due to error as her husband was born in 1942. This is nevertheless likely to stop her recent complaint to the Ombudsman in its tracks.

But Audrey Watson, 81, who received £1,500 after also being paid too little for 13 years, has complained to the Ombudsman too and will continue the fight.

>>>Have you been underpaid state pension? Find out what to do below 

Many women who suspect their payments are incorrect have bombarded the DWP asking for them to be checked in recent months, and we understand an official probe is now under way. See a full statement from the DWP below.

Meanwhile, the Government has botched payouts to two other women besides Mrs Brennan in recent months.

Diane Sears, 73, who is disabled, originally received £3,800 including interest earlier this year. 

But her backpayment missed out a year, and following a further complaint by her husband Raymond, the DWP apologised and paid Mrs Sears from Suffolk nearly £500 more.

Carole Graham, 70, was told in May she would receive around £8,600 in arrears after she sent her marriage certificate to the DWP. 

She posted and received it back, but three weeks later she got a letter saying her state pension would not be changed after all.

As her backpayment had also failed to show up, Mrs Graham, a retired hairdresser from Berkshire, and her husband Stephen got back in contact with This is Money in mid-July.

After we raised her case again, the DWP apologised and agreed to pay her around £9,450 including interest.

The Labour Party has pressed the Government to carry out a full investigation and ensure all women are paid what they are owed.

Shadow Pensions Minister Jack Dromey has brought up the issue in parliament.  He says: ‘There is not just a legal duty but also a moral duty on the DWP to take every step necessary to put right past wrongs, where women who worked hard all their lives were denied the full pension they were entitled to.

‘These latest revelations are scandalous. Kathleen fought hard for what she was owed and won a £9,700 payment. 

‘It beggars belief that the DWP now say they made an error and are refusing to fully pay other women just like Kathleen for what they are owed too.

‘Also Diane, a disabled woman who at last received some compensation only to discover she was entitled to £500 more. And Carole, told she would receive £8,600, then sent confusing information, but now receiving £9,450 following the intervention by This is Money.’ 

Dromey recently wrote to the DWP to say the information it provides to women affected by state pension errors is ‘very limited and appears to be extremely variable’. He also made the following points.

– Some women are wrongly told that they are not entitled to arrears and it has taken several attempts to get a payment.

– Among those being repaid, some women have received lump sums in their bank accounts with ‘no warning and little explanation’.

– There has been no information provided to them on interest repayments, or the tax implications of suddenly receiving a lump sum. 

– Many have only received interest payments after following this up with the DWP.

– It would be hugely helpful and clear up some confusion if the DWP set out information clearly, along with some ‘Frequently Asked Questions’ in letters to women who are repaid, and put it up on a gov.uk web page. 

This is Money understands the DWP is deciding interest payments based on whether a woman was underpaid for more than a year, whether it was down to government error and whether interest would amount to £10 plus.

However, many women appear to be struggling to get interest on their belated state pension payments. 

Former Pensions Minister Steve Webb says of recent Government mistakes involving Mrs Brennan and other women: ‘What concerns me most is that we are no longer talking simply about errors made back in the mists of time.

‘Even with all the focus on this issue at the highest level we are hearing too often of people being given misleading information on the phone or in writing, missing out on compensation when it is due or even getting a payment in error.

‘There needs to be much more focus on getting these things right first time and on proper checking. It is the least that those who have been underpaid should be able to expect.’ 

Now a partner at pension consultant LCP, Webb adds regarding interest payments: ‘Where people have gone without large amounts of money for several years, and where this is purely down to government error, interest should be added as of right.

‘At the moment it seems something of a lottery as to whether people get interest or not. One person I spoke to who had asked about interest was told on the phone that they wouldn’t get interest “because we’re not a bank”.

‘This is totally unacceptable. It is bad enough that people have been underpaid state pensions for so long. They should not have to battle for interest as well.’

What does the Government say?

A DWP spokesperson says: ‘We are aware of a number of cases where individuals have been underpaid state pension.

‘We corrected our records and reimbursed those affected as soon as errors were identified. We are checking for further cases, and if any are found awards will also be reviewed and any arrears paid.’

It notes that married women are required to make a claim to have payments increased if their husband reached state pension age before 17 March 2008, but not if he did so after that.

The DWP says it encourages anyone who thinks they have failed to claim a state pension increase they are eligible for to contact the department.

It has previously told us that ‘interest and consolatory payments’ will be considered on a case-by-case basis and depend on individual circumstances.

DWP staff have rung Mrs Brennan to apologise for paying her nearly £9,800 by mistake. 

She was told her payout dated back to 2010, which was when her husband stopped deferring his state pension, rather than when he reached state pension age in 2007.

Other women receiving full backpayments have received money covering the deferment period too. 

Regarding Mrs Sears’s case, the DWP says: ‘We are very sorry for the delay and the administrative error that led to [her] state pension review not being processed correctly. We have amended this and paid the arrears owed.’

And regarding Mrs Graham, the DWP says: ‘We wholeheartedly apologise to [her] for not updating her state pension when we were provided with the relevant information.

‘This was due to an administrative error. We have now paid all backdated pension arrears to Mrs Graham and corrected her state pension award.’