Inadequate state pension
Systemic issues leading to the State Pension being inadequate for many pensioners, causing financial difficulties and hardship.
87 items
4 sources
Strongest theme matches
Mixed across source types and ranked by classifier confidence plus text match strength.
Committee recommendation
100match
#2 - Thirty-Third Report - Underpayments of the State Pension
The Department’s complacency about the level of underpayments inherent in its approach to administering State Pension has led it to fail pensioners. The Department’s highly manual systems and complex State Pension rules has led to calculation errors and the underpayment of thousands of pensioners. The Department, however, argued that low annual error rates on State Pension led it...
Matched on
terms: inadequate, pension, state
Committee recommendation
100match
#33 - Many pensioners, including 2.1 million, rely on inadequate State Pension and experience hardship.
One in eight pensioners rely solely on the state pension and it makes up 80% of the retirement income of the poorest pensioners. The Minister for Pensions said to us that the State Pension formed the ‘bedrock of Government support’ for pensioners, yet we heard that many of those who rely on it are experiencing financial difficulties and...
Matched on
exact phrase
terms: inadequate, pension, state
Committee recommendation
95match
#3 - Thirty-Third Report - Underpayments of the State Pension
The Department has not given people who are worried they have been underpaid enough information to find out what they should do, with the risk that many may still miss out on money they should receive. The Department’s communications strategy is to only contact those who it finds have been underpaid under the State Pension regulations. Other groups...
Matched on
terms: pension, state
Committee recommendation
87match
#34 - Establish a plan to ensure State Pension adequacy for all, reviewing undermining system aspects.
Once an objective for the State Pension relating to adequacy has been agreed, the Government should put in place a plan for getting everyone to that level. The first step should be to review those aspects of the state pension and benefits system that undermine its adequacy for some pensioners. (Recommendation, Paragraph 167)
Matched on
terms: pension, state
Committee recommendation
87match
#30 - State pension design and level significantly influence pensioner poverty and health outcomes.
We note evidence from the UK and internationally shows that the design and level of state pension benefits can have a significant impact on pensioner poverty, as well as improving health outcomes. (Conclusion, Paragraph 146)
Matched on
terms: pension, state
Committee recommendation
86match
#17 - Thirty-Third Report - Underpayments of the State Pension
When we asked if the Department is able to provide greater clarity to those who think they may have been affected, the Department said that it cannot publish guidance for those who may have been underpaid, such as an online questionnaire, because it believes it cannot accurately cover all possible underpayment scenarios. It said it did not want...
Matched on
terms: pension, state
Committee recommendation
86match
#32 - Consult on State Pension objectives, aiming for dignified living standards and reducing pensioner inequality.
The pensions adequacy review should consult on objectives for the State Pension, taking account of adequacy, sustainability and fairness. Given that it is the core of the Government’s offer to pensioners, relied on by many pensioners on low incomes, a guiding principle should be that it provides the amount needed for a minimum, dignified, socially acceptable standard of...
Matched on
terms: pension, state
Committee recommendation
86match
#6 - Twenty-Sixth Report - The Department for Work and Pensions’ Accounts 2021–22 – Fraud and error in...
The Department’s efforts to correct the systemic underpayment of State Pension are too slow to meaningfully put things right. The Department now estimates that 237,000 pensioners have been underpaid a total of £1.46 billion in their State Pension. Despite these underpayments going back as far as 1985, the Department’s overall exercise to correct this issue is delayed from...
Matched on
terms: pension, state
Committee recommendation
86match
#22 - Thirty-Third Report - Underpayments of the State Pension
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...
Matched on
terms: pension, state
Committee recommendation
86match
#20 - Thirty-Third Report - Underpayments of the State Pension
Managing Public Money (A4.14) states that ‘when public sector organisations have caused injustice or hardship because of maladministration or service failure, they should consider providing remedies so that, as far as reasonably possible, they restore the wronged party to the position that they would be in had things been done correctly’.50 The payment of a lump sum of...
Matched on
terms: pension, state
Committee recommendation
83match
#1 - Thirty-Third Report - Underpayments of the State Pension
On the basis of a report by the Comptroller and Auditor General, we took evidence from the Department for Work & Pensions on the issue of underpayments in State Pension1
Matched on
terms: pension, state
PHSO recommendation
83match
Women's State Pension age: our findings on injustice and associated issues
We did not find that the sample complainants suffered an unremedied injustice because of maladministration in DWP's communication about the number of National Insurance qualifying years needed for a full State Pension. But it is possible others have lost opportunities to add qualifying years to their National Insurance record. We would have recommended DWP provides remedy in line...
Matched on
terms: pension, state
Committee recommendation
82match
#41 - State Pension age increases disproportionately impact deprived areas, raising pre-pensioner poverty levels.
The State Pension age is an important tool for containing the costs of the State Pension. However, improvements in life expectancy across the country have stalled. People living in the most deprived areas of the country have lower life expectancy and lower healthy life expectancy than people in less deprived areas. Increases in the State Pension age have...
Matched on
terms: pension, state
Committee recommendation
82match
#7 - Thirty-Third Report - Underpayments of the State Pension
Given the nature of the underpayments identified there must be a risk that similar, unidentified errors exist elsewhere in the State Pension caseload. For example, 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”. However, Sir Steve...
Matched on
terms: pension, state
Committee recommendation
82match
#6 - Thirty-Third Report - Underpayments of the State Pension
In paying pensioners, a lump sum of their arrears, the Department may not be fully restoring them to the position that they would be in had the Department paid them correctly in the first place. The payment of a lump sum of arrears may affect the pensioner’s current or future entitlement to other benefits such as Pension Credit,...
Matched on
terms: pension, state
Committee recommendation
81match
#19 - Thirty-Third Report - Underpayments of the State Pension
The Department told us that it began exploring the potential for underpayments from April 2020, following a number of complaints by individual pensioners and a campaign by the former pensions minister Sir Steve Webb and Tanya Jefferies of Thisismoney.co.uk from January 2020, who provided the Department with example cases of underpayment.44 The Department then published an estimate of...
Matched on
terms: pension, state
Committee recommendation
78match
#29 - Twenty-Sixth Report - The Department for Work and Pensions’ Accounts 2021–22 – Fraud and error in...
In our January 2022 report, we warned that, given the nature of underpayments identified, there was a risk that similar, unidentified errors existed in the State Pension caseload.60 In 2021–22 the Department identified several new groups of pensioners potentially affected by underpayment, the most significant relating to Home Responsibilities Protection (HRP). For people reaching State Pension age before...
Matched on
terms: pension, state
Committee recommendation
78match
#27 - Twenty-Sixth Report - The Department for Work and Pensions’ Accounts 2021–22 – Fraud and error in...
In January 2021 the Department launched an exercise to review around 400,000 cases ‘at risk’ of underpayment to confirm the extent of the issue and reimburse affected pensioners. The Department wrote to us in May 2022 explaining that it was on track to conclude the review of the original 400,000 cases by the end of 2023.52 But it...
Matched on
terms: pension, state
Committee recommendation
78match
#16 - Thirty-Third Report - Underpayments of the State Pension
The Department decided to contact pensioners reviewed as part of the State Pension LEAP exercise only if a correction was made to their basic State Pension.36 Other groups of pensioners can receive arrears if they make a claim to the Department, however, the Department has provided very little information to such pensioners on how to do so. There...
Matched on
terms: pension, state
Committee recommendation
77match
#30 - Twenty-Sixth Report - The Department for Work and Pensions’ Accounts 2021–22 – Fraud and error in...
The NAO reported that the Department cannot rule out that there may be further groups of pensioners, as yet unidentified, that have been affected by a historic underpayment. It concluded that this was in large part because the Department had not set out plans to revise its control processes for State Pension cases to ensure that underpayments are...
Matched on
terms: pension, state
Committee recommendation
77match
#28 - Twenty-Sixth Report - The Department for Work and Pensions’ Accounts 2021–22 – Fraud and error in...
In our January 2022 report we were concerned that the Department had not given people who were worried that they had been underpaid enough information to find out what they should do, and that there was a risk that many would still miss out on money they should receive.55 In May 2022, the Department wrote to us to...
Matched on
terms: pension, state
Committee recommendation
77match
#2 - Women face systemic challenges and policy 'blind spots' in pension system design.
Improving pension outcomes requires an understanding of the systemic challenges. Of the groups at risk, we took most evidence on the position of women, who make up two-thirds (67%) of pensioners in poverty. Some positive steps have been taken to improve their pension outcomes: in particular, through the introduction of the new State Pension. However, there remain ‘blind...
Matched on
terms: pension, state
Committee recommendation
73match
#8 - Third Report - Protecting pension savers – five years on from the pension freedoms: Saving for...
People in generation X and older without access Defined Benefit pension saving will have had limited time to build up pension savings through auto-enrolment and are therefore at risk of not hitting their retirement adequacy targets. We recommend the Government should consult on a plan to address this challenge and report back to us by March 2023. According...
Matched on
terms: pension, state
Committee recommendation
73match
#25 - Twenty-Sixth Report - The Department for Work and Pensions’ Accounts 2021–22 – Fraud and error in...
We examined the Department’s systemic underpayment of State Pension in January
Matched on
terms: pension, state
Committee recommendation
69match
#21 - Thirty-Third Report - Underpayments of the State Pension
Some of those who contacted the Department prior to the LEAP exercise starting in January 2021 received special payments of interest on top of their underpayment.54 The Department chose to stop paying interest on arrears, citing value-for-money considerations and comparability of treatment in other LEAP exercises.55 When we challenged the Department on the fairness of this treatment, it...
Matched on
terms: pension, state
Committee recommendation
69match
#5 - Thirty-Third Report - Underpayments of the State Pension
The Department has not been sufficiently transparent to Parliament about the State Pension underpayments. Until recently, the Department has been reluctant to provide details of the volume or value of State Pension underpayments or the backlog in processing new State Pension applications to the general public or Parliament. We note that the Department’s routine position is that it...
Matched on
terms: pension, state
Committee recommendation
66match
#12 - Winter Fuel Payment changes created significant uncertainty and anxiety among older pensioners
Our predecessor Committee is amongst those that have criticised Winter Fuel Payments for being poorly targeted and a ‘blunt instrument’ for tackling fuel poverty. As a universal payment, WFP went to pensioners who did not need it, and its real terms value has dwindled over two decades since it was introduced. However, we heard very clearly that pensioners...
Matched on
terms: pension
Committee recommendation
66match
#1 - Pensioner poverty has risen since 2010, leaving millions below the Minimum Income Standard.
The reductions in pensioner poverty in the late 1990s and 2000s, with the introduction of Pension Credit, were a success. However, we are concerned that from 2010 rates started to rise again. And the latest data on living standards paints a bleak picture, with 2.8 million pensioners living in households below the Minimum Income Standard. No older person...
Matched on
terms: pension
Committee recommendation
65match
#39 - Rising number of private renting pensioners are at increased risk of poverty from Local Housing Allowance.
The Pensions Policy Institute expects the number and proportion of pensioners renting privately to grow from around 6% now to 17% in 2041. As many as 400,000 households could become dependent on means-tested benefits. Pensioners renting privately are already at risk of poverty, with the operation of the Local Housing Allowance a contributing factor. (Conclusion, Paragraph 184)
Matched on
terms: pension
Committee recommendation
65match
#31 - Twenty-Sixth Report - The Department for Work and Pensions’ Accounts 2021–22 – Fraud and error in...
We have previously concluded that the Department had been relying on a State Pension payment system that is not fit for purpose for decades, and recommended that it consider ways to upgrade its IT systems as a matter of urgency.66 The Department accepted 59 Q 101 60 Committee of Public Accounts, Underpayments of the State Pension, Thirty-Third Report...
Matched on
terms: pension, state
Committee recommendation
57match
#4 - Require the pensions adequacy review to consider pension inequalities and poverty in retirement
The pensions adequacy review should consider pension inequalities, the groups who are more likely to live in poverty in retirement, and how this will be addressed. (Recommendation, Paragraph 30) 81 Impact on older people
Matched on
terms: pension
Committee recommendation
57match
#6 - Third Report - Protecting pension savers – five years on from the pension freedoms: Saving for...
The middle of a cost of living crisis is not the time to ask people to pay more into their pension. However, if they are to do so in future, work to prepare the ground needs to start now to build consensus on the need for change among employers and the wider public. As a first step, the...
Matched on
terms: pension
Committee recommendation
57match
#26 - Twenty-Sixth Report - The Department for Work and Pensions’ Accounts 2021–22 – Fraud and error in...
By the publication of its Annual Report & Accounts in July 2022 the Department estimated that 237,000 pensioners had been underpaid around £1.46 billion. This is an increase of 105,000 pensioners and £429 million compared with its best estimate as at 31 March 2021, but remains within the range of uncertainty the Department set out at the time.49...
Matched on
terms: pension
Committee recommendation
56match
#32 - Fifth report - Protecting pension savers—five years on from the Pension Freedoms: Accessing pension savings
We support the Government’s intention to make pensions simpler. Recent policy changes to the normal minimum pension age have highlighted the difficulties of achieving this and we are disappointed that these changes have made making decisions about accessing pensions even more difficult. Savers take a working lifetime to build up pension savings, through many changes of policy and...
Matched on
terms: pension
Committee recommendation
53match
#8 - Sixth Report - Public Sector Pensions
HM Treasury has since been developing a remedy for those affected.14 In February 2021, HM Treasury announced that it plans to give the 3 million members affected by the McCloud judgment a choice of which scheme they would like their service between April 2015 and March 2022 to count towards. The affected members will make this choice at...
Matched on
terms: pension
Committee recommendation
53match
#7 - Sixth Report - Public Sector Pensions
As a part of the 2011–2015 reforms, HM Treasury offered ‘transitional protection’ to those closest to retirement. This meant that scheme members within 10 years of their normal retirement age would see no change to their pension age or their expected pension.12 In 2018, the Court of Appeal ruled that these protections were discriminatory on the basis of...
Matched on
terms: pension
Committee recommendation
53match
#2 - Fifth report - Protecting pension savers—five years on from the Pension Freedoms: Accessing pension savings
Making pensions decisions is complicated. The continued movement from DB to DC, together with auto-enrolment and the increased number of jobs that one person will have over a working lifetime, mean that without intervention decision-making will become more complicated still. The Government and regulators have a role to play in ensuring that savers have the information and support...
Matched on
terms: pension
Committee recommendation
53match
#31 - Pensions adequacy review welcomed for focusing on outcomes and diverse measurement approaches.
We welcome the pensions adequacy review and its focus on outcomes. We note that there are different measures, which are all helpful in telling us different things, such as: replacement rates indicate the extent to which 86 people are able to maintain a standard of living throughout life; the relative poverty measure tracks how people on low income...
Matched on
terms: pension
Committee recommendation
52match
#1 - Fifth report: Protecting pension savers—five years on from the pension freedoms: Pension scams
People save for retirement and later life in many different ways, not solely through their pensions. During the course of our inquiry we have been contacted by a number of people who have lost savings, other than pensions, which were intended to support them in retirement.
Matched on
terms: pension
Committee recommendation
52match
#8 - Fifth report - Protecting pension savers—five years on from the Pension Freedoms: Accessing pension savings
We recommend that the Money and Pensions Service and the Financial Conduct Authority should develop proposals to increase the number of people choosing a mix of retirement products—including cash, drawdown and deferred annuities—to meet their changing needs at different stages of later life.
Matched on
terms: pension
Committee recommendation
52match
#6 - Fifth report - Protecting pension savers—five years on from the Pension Freedoms: Accessing pension savings
Many more people than currently do, however, would benefit from making greater use of the pension freedoms by choosing a mix of annuities, lump sums and drawdown Protecting pension savers—five years on from the Pension Freedomss Accessing pension savings 61 rather than a single product. For example, a person may wish to withdraw a lump sum when they...
Matched on
terms: pension
Committee recommendation
52match
#4 - Fifth report - Protecting pension savers—five years on from the Pension Freedoms: Accessing pension savings
People can usually take up to 25% of their pension as a tax-free lump sum. This is one of the most well-known UK pension policies and leads to many people who access their pensions for the first time taking poor decisions about the remaining 75%. We heard persuasive arguments both for and against decoupling the 25% of a...
Matched on
terms: pension
Committee recommendation
48match
#18 - Sixth Report - Public Sector Pensions
The employer contribution rate is next due to be implemented in 2024, where it may change again. Both the SCAPE discount rate—which is a key assumption used to help set the employer contribution rate and drove the 2019–20 increase in employers contributions—and its methodology will be reviewed prior to 2024.40 Impact on employees
Matched on
terms: pension
Committee recommendation
48match
#10 - Sixth Report - Public Sector Pensions
While the cost control mechanism was only used for the first time in 2016, HM Treasury is concerned that it is not sufficiently protecting the taxpayer and members. The provisional results of the 2016 valuations show that costs had fallen across all schemes, and therefore members could expect an increase in their benefits or a reduction in the...
Matched on
terms: pension
Committee recommendation
48match
#9 - Fifth report - Protecting pension savers—five years on from the Pension Freedoms: Accessing pension savings
The Pension Schemes Act 2021 enabled collective defined contribution (CDC) schemes, which provide retirement incomes from a collective fund. The income from the fund received by members varies depending on how the fund performs. There is demand for the further development of CDC schemes in future and it is therefore right that the Government continues to support this....
Matched on
terms: pension
Committee recommendation
48match
#7 - Fifth report - Protecting pension savers—five years on from the Pension Freedoms: Accessing pension savings
Hybrid products which provide a ready-made mix of lump-sums, drawdown and annuities can be complicated and costly. We believe that a personalised mix of retirement products would better meet the needs of savers. However, these options will be difficult for savers to choose themselves without thorough guidance and most savers would likely need paid-for advice, which gives a...
Matched on
terms: pension
Committee recommendation
48match
#5 - Fifth report - Protecting pension savers—five years on from the Pension Freedoms: Accessing pension savings
We were told that most savers want a reliable income in retirement. Annuities provide this for savers with defined contribution pensions, but have dramatically fallen in use since the introduction of pension freedoms. The transition from defined benefit schemes to defined contribution schemes means that fewer people will have occupational pensions which provide a guaranteed income in future...
Matched on
terms: pension
Committee recommendation
48match
#7 - Third Report - Protecting pension savers – five years on from the pension freedoms: Saving for...
In addition to any increase in the statutory minimum, we have been persuaded that there is scope to expand the use of targeted ways to improve outcomes or increase contributions. We recommend the Government commit to a trial of auto-escalation schemes, such as Save More Tomorrow (where people commit in advance to paying part of future salary increases...
Matched on
terms: pension
Committee recommendation
44match
#37 - Mixed age couple rule inappropriately places older partners on lower Universal Credit payments.
The mixed age couple rule means that where one member of a couple is under pension age, they must claim working age benefits, rather than pension benefits as previously. The outcome is that some people in their 70s are still on Universal Credit, which is paid at a significantly lower level than Pension Credit. The rationale for this...
Matched on
terms: pension
Committee recommendation
43match
#12 - Second Report - BBC strategic financial management
The BBC faces a number of emerging financial challenges. These include:22 • A significant change in policy for over-75s TV licences which the BBC estimates will leave it £200 million a year worse off. Under the 2015 licence fee settlement, the government gradually withdrew its funding for free TV licences for all over- 75s, while the BBC was...
Matched on
terms: pension