Have you been affected by an underpaid state pension?

On the Which? Money Helpline we’re being contacted by a growing number of members that are thinking that they may be affected by an underpaid state pension.

This was originally highlighted by Pension Consultants Lane Clarke & Peacock in May, which has been told that the average payout is in the region of £9,000.

This affects women who were married and reached state pension age (SPA) before April 2016, who can claim the basic state pension.

Which? News: six groups of women underpaid state pensions

Under the old state pension rules, women could claim a basic state pension at 60% of the full rate based on the contributions of their husband’s – but only where this would exceed what they would have got based on their own contributions.

Before 17 March 2008, a married woman would need to make a claim to have her pension increased – but since that date the uplift should have happened automatically.

Changing state pension systems

Under this old system, each member of a couple could build up a pension in their own right. In theory, each member of a married couple could earn a full state pension.

But many women had gaps in their National Insurance (NI) record or had paid the specially reduced ‘married woman’s stamp’, and so reached pension age with very limited pension entitlement of their own. The main groups affected by this issue are:

🔷 Married women whose husband turned 65 before March 17, 2008 and who have never claimed an uplift to the 60% rate

🔷 Widows whose pension was not increased when their husband passed away

🔷 Widows whose pension is now correct, but who think they may have been underpaid while their late husband was still alive, particularly if he reached the age of 65 after March 17, 2008

🔷 Women in their eighties who are receiving a basic pension of less than £80.45

🔷 Widowers and heirs of married women, where the woman has passed away but was underpaid state pension during her lifetime

🔷 Divorced women, particularly those who divorced after retirement, to check that they are benefiting from the contributions of their ex-husband

Are you eligible to claim?

LCP has a calculator that you can use provided you have the correct information about your circumstances such as dates of birth and what pension is currently being paid.

You’ll need to enter some details about you and your husband (or husband at the time), including when you were born, whether your husband is over SPA, how much basic state pension you currently receive and how much your husband (or ex-husband) receives.

You’ll then be given an indication of whether you’re receiving less than you’re entitled to. LCP says all data is given anonymously and it doesn’t store any of the personal data you input.

According to LCP since its investigation published in May, the firm has had more than 160,000 people visit its website calculator.

However, if you have any concerns or questions about your pension you should contact the government’s Pension Service or talk to a regulated financial adviser. Do you think you may have been affected by an underpaid state pension?

Helping our members

Did you know about Which? Money Helpline? It’s staffed by financial experts with more than 100 years’ experience in the financial services industry between them.

Members can ask us questions about a range of personal finance subjects, and there are no limits to the number of calls you and your family can make, or the length of time you can spend talking to us.

Which? members can call the helpline on 029 2267 0001.