State pensioners told they could lose money due to DWP major rule change

Fears have been raised by a former minister that some state pension records could be wiped out, making it "virtually impossible" to rectify past payment errors.

In recent years, numerous mistakes in state pension payments have come to light, with some of the affected individuals passing away before the issues could be resolved.

Even after someone's death, these errorscan potentially be corrected, with any owed money going to their heirs.

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Sir Steve Webb, an ex-Liberal Democrat pensions minister, has written to Sir Peter Schofield, the permanent secretary at the Department for Work and Pensions (DWP), urging him to ensure that records are kept as long as necessary to resolve any outstanding state pension errors.

A Freedom of Information (FOI) response received by Sir Steve, who had requested information from the DWP, revealed that the department temporarily halted deletions in 2021 as part of a major correction exercise on underpaid pensions to married women, widows and those over 80.

Sir Steve warned that sincepension records are typically deleted four years after a person's death, there is a risk that records dating back to 2017 could eventually be erased, making it more difficult for families to seek justice.

The FOI reply stated: "Application of the standard retention policy remains paused. Once the embargo is lifted, then we will look at deletion of records that are no longer required and re-apply the retention policy."

Sir Steve, who is now a partner at consultants LCP (Lane Clark & Peacock), warned that with roughly 500,000 people over state pension age dying each year, a decision to delete data for deaths between 2017 and 2020 inclusive, which were originally kept but are now more than four years old, could potentially result in as many as two million records being wiped.

He explained that some of these would include women who had missed out on "home responsibilities protection" – a scheme designed to safeguard parents' and carers' state pension – whose families may be unable to have the situation rectified.

Sir Steve highlighted previously-released DWP figures showing that out of an estimated 194,000 people affected by errors relating to home responsibilities protection, 43,000 died having never benefited from the protection.

Those who were deceased were underpaid an estimated £127 million.

Sir Steve urged people who believe there may have been errors to have their records checked.

He said: "I often hear from people who are trying to sort out errors in the state pension of loved ones who are no longer with us, but are told nothing can be done because the records have been destroyed.

"Whilst we cannot get back the records that have already been deleted, it is essential that DWP does not now delete millions more records, especially given the live process of trying to fix errors around home responsibilities protection.

"The least we can do for people who were never paid the right pension is to do all we can to make sure that at least their families get the money they missed out on."

The DWP's stance on data deletion is continually under review, and no decision has been made to return to the usual business process.

A spokesperson for the DWP stated: "We are committed to ensuring pensioners get the financial support they deserve and have so far reviewed over 900,000 customer records, with awards totalling over £900 million in arrears made.

"Where errors do occur we are committed to resolving them, which is why we have paused deleting state pension records."