Thousands of retirees across the UK have been left short-changed by a staggering £804.7 million state pension underpayment blunder. The Department for Work and Pensions (DWP) has now confirmed that more than 130,000 pensioners—mainly women, widows, and over-80s—have been affected by decades of administrative errors and outdated record-keeping systems.
This scandal underscores a long-standing flaw in the UK’s pension system, with critics calling it one of the most shameful episodes in the history of public benefits.
How Did This Happen?
Between January 2021 and March 2025, the DWP carried out a review of state pension records and uncovered 130,948 cases of underpayments. These errors—stretching back years, even decades—have left pensioners out of pocket by thousands of pounds.
The root cause? Outdated manual systems, administrative mistakes, and a failure to automatically update entitlements for certain groups of pensioners.
In some heartbreaking cases, individuals were underpaid by as much as £12,000. The average repayments range from £2,000 to £11,700, depending on the individual’s circumstances. Tragically, many who were owed this money have since passed away, leaving surviving families unable to reclaim what was rightfully theirs.
Who Has Been Hit the Hardest?
The pensioners impacted largely fall into three vulnerable groups:
| Group | What Went Wrong |
|---|---|
| Married Women | Often entitled to increased pensions when husbands retired but never received them. |
| Widows | Pensions were not properly updated after the death of a spouse. |
| Over-80s | Missed out on automatic increases after reaching 80. |
Some people fall into multiple categories, increasing the size of their underpayments.
Additional Blunder: HRP (Home Responsibilities Protection) Errors
The scandal doesn’t end there. A separate review into Home Responsibilities Protection (HRP), designed to protect pension rights for those (mainly women) who left work to care for children, uncovered 5,344 additional cases, with another £42 million underpaid by September 2024.
Calls for Accountability Are Growing Louder
Former pensions minister Sir Steve Webb has been vocal about the scale of the issue, campaigning for swift repayments and system reforms. He noted the injustice of women being underpaid for decades and dying without ever receiving what they were owed.
Rachel Vahey, a leading financial expert from AJ Bell, labeled this debacle one of the biggest benefits scandals in UK history, demanding faster resolutions and systemic improvements to prevent future mistakes.
DWP’s Response and What’s Next
A DWP spokesperson admitted the underpayments were “deeply regrettable” and reaffirmed their commitment to identifying and correcting errors. While most affected pensioners are being contacted directly, the DWP urges anyone who thinks they—or a deceased relative—may have been affected to come forward.
What Should You Do If You Think You’ve Been Underpaid?
✅ Steps You Can Take:
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Check your state pension records carefully.
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Contact the Pension Service directly to inquire about any potential underpayments.
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If your spouse has passed away, you may be entitled to arrears owed to them.
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Consider speaking with a benefits advisor or using pension calculators to verify your entitlement.
FAQs – State Pension Underpayments 2025
1️⃣ Why has the DWP underpaid so many pensioners?
Errors occurred due to manual processes and outdated systems, especially for women relying on increases through marriage, widowhood, or age-related entitlements.
2️⃣ How much money could I be owed?
Underpayments vary. Some pensioners are receiving between £2,000 and £12,000, depending on how long they went underpaid.
3️⃣ What if my spouse or relative has passed away?
If they were underpaid, their estate might still be entitled to the arrears. Contact The Pension Service to discuss eligibility.
4️⃣ How can I check my own entitlement?
Use the State Pension forecast tool or contact The Pension Service to verify whether your payments are correct.
5️⃣ Has the DWP fixed these errors moving forward?
The DWP says it has taken steps to improve its systems to prevent future mistakes—but critics argue ongoing vigilance is essential.
Final Thought: Don’t Leave Money on the Table
This pension underpayment scandal reveals the importance of checking your entitlements regularly, especially if you fall into a vulnerable category like married women, widows, or those over 80.
If in doubt, reach out—it’s better to check now than to lose out on money you’re rightfully owed.
