State Pension Bungle Means Thousands Are Wrongly Paid


Thousands of people, including expats, are receiving the wrong state pension payments after a data foul up by the government.

The mistakes were found when an independent firm was called in to clean up millions of state pension files by the Department of Work and Pensions.

Because of the bungle, thousands of pensioners have had their payments increased, while many have been paid too much.

Despite the mistakes not being their fault, no one paid too little will pick up interest or compensation, but those overpaid will not have to repay the money.

Errors detected in data clean-up

Although those paid less than they should have received will receive a lump sum back payment, no account is taken of inflation that has reduced their spending power.

The clean-up found errors meant some people were wrongly over or under paid £50 a month, and some could receive up to £10,000 too little over their lifetime.

The government says they will write a letter of apology outlining the error and how their state pension is impacted to everyone affected.

A government spokesman said: “The reconciliation exercise has been under way for some time. Most queries submitted as part of the exercise do not have an impact on the amount of an individual’s state pension.

Expats pensions affected

“However, where queries do result in changes, we are notified by HMRC, and where the pension is in payment, review the award and notify the individual of the change.

“HMRC and pension scheme administrators determine whether the figures are correct. However, where overpayments of state pension do occur due to incorrect figures, individuals will not be expected to repay any overpayments.”

The errors centre around a calculation called the guaranteed minimum pension, which is affected by ‘contracted out’ national insurance payments.

The findings throw doubt on how much state pension expats receives, especially those who have their payments frozen because they live in a country where index-linking to inflation does not apply.

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