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Since our evidence session Sir Steve Webb has also drawn our attention to a potential...

Conclusion
Since our evidence session Sir Steve Webb has also drawn our attention to a potential systemic error affecting divorced pensioners. The NAO report states that “the Department did not find any significant evidence that it had failed to properly process cases where a pensioner had notified it of their divorce”.58 However Sir Steve believes the scope of the correction exercise is too narrow and should be extended to included divorced people for the following reasons. He told us that in October 2021 the Department published figures which show that there are 720,000 divorced women on the old state pension system. Although a divorced woman could be entitled to up to a full basic pension of £137.60, 40,000 divorced women are on less than £82.45 per week, suggesting there could be many divorced women losing out. In his view the type of error which caused the underpayments occurs when there is a change of circumstances (husband retires, husband dies, pensioner turns 80) and no pension reassessment takes place; exactly the same issue can arise when someone phones up to report a divorce. He told us that in recent months he has identified several individual cases of divorced women who were being paid the wrong amount (or no pension at all) and in each case the Department has accepted that money is due and has paid substantial arrears.59 53 Q 4, Letter from Permanent Secretary of the Department for Work & Pensions to the Chair of the Committee of Public Accounts, dated 15 November 2021. 54 Q 132 55 Q 133; C&AG’s Report, para 4.3 56 Q 139 57 Qq 144–148 58 C&AG’s Report, para 3.7 59 Letter from Sir Steve Webb to the Chair of the Committee of Public Accounts, dated 7 Dec 2021 Underpayments of the State Pension 17
Government Response

A response document is linked to this report, dated 28 April 2022. Response attribution to this conclusion has not been verified. Read the response document.

Addressee Bodies
HM Treasury
Timeline
Recommendation age 4.6 yrs
Report published 21 Jan 2022