Hundreds of thousands of parents warned system error could mean they miss out on state pension payments
HUNDREDS of thousands are being urged to check if they are owed thousands of pounds in state pension due to a system error.
Some parents who claimed Child Benefit before 2000 are missing out on the extra cash due to gaps in their National Insurance (NI) records.
His Majesty’s Revenue and Customs (HMRC) has taken to X, formerly known as Twitter, to encourage those potentially affected, mainly women, to make an easy check.
Writing on the platform it said: “If you claimed Child Benefit before May 2000, you may be missing Home Responsibility Protection (HRP) from your National Insurance record.
“Claiming now may increase your State Pension. Complete our eligibility checker and see if you can claim.”
Those affected are parents who claimed Child Benefit before 2000 and are missing out on the extra cash due to gaps in their National Insurance (NI) records.
These mothers should have had ‘Home Responsibilities Protection’ (HRP) on their NI record since 1978 when they were raising children, but in many cases, this is missing which means they aren’t getting paid all the state pension they should.
The mistake, which was first revealed in 2022, has seen hundreds of thousands of people miss out on retirement money they’re entitled to.
When the mistake was uncovered the DWP described it as the “second largest” source of errors in state pensions.
Those affected are people who claimed child benefit, largely women who were stay-at-home mums, before May 2000 as they could have gaps in their NI record which in turn affects the amount of state pension they get.
The amount of state pension someone gets is based on their NI contributions and the number of “qualifying years” they have.
From 1978 to 2010, protection was provided for parents to avoid these gaps by a system known as Home Responsibilities Protection (HRP) credits.
This system was then replaced in 2010 by the one we have now, called National Insurance Credits.
If someone claimed child benefit before May 2000 and did not provide their NI number on the form, it’s possible that their credits may not have been transferred to their NI account from the child benefit computer.
This may affect their pension entitlement and women who are now in their 60s and 70s are most likely to be affected.
The DWP has already started sending letters to people who might have been entitled to HRP between 1978 and 2010 but have no HRP on their NI record.
It says so far it has written to 370,000 people, of which 257,000 were over State Pension Age.
It expects to send several hundred thousand letters to those affected over the next 18 months.
Where errors are found, NI records will be corrected and the DWP will then recalculate state pensions and pay arrears.
This could result in increased pension payments as well as a lump sum payment.
Last year, The Sun spoke to Susan Burton, 66, who almost missed out on £50,000 for her retirement because of this error.
Another woman, 74, has received a £17,000 windfall after falling victim to the error.
It means that finding out if you have been missing out, could mean a big payday.
What are state pension errors?
STEVE Webb, partner at LCP and former Pensions Minister, explains what state pension errors are and how they can occur:
The way state pensions are worked out is so complicated that many thousands of people have been paid the wrong amount for years without even realising it.
The amount of retirement pension you get usually depends on your National Insurance (NI) record.
One big source of errors has been cases where NI records have been incorrect, particularly for years spent at home with children.
This is a system known as ‘Home Responsibilities Protection’.
Alternatively, particularly for older pensioners, the amount you get can depend on the NI contributions made by your spouse.
Errors have arisen where the Government has failed to adjust the pensions of married women when their husbands retired or failed to increase pensions when someone was bereaved and lost a husband or wife.
Although the Government has spent years trying to fix these problems, there are still many thousands of people – many of them older women – on the wrong pension.
If you have always thought that your pension seems low, then it is worth contacting the Pensions Service to ask them to check, especially if you spent time at home raising children or if you were widowed and your pension didn’t change when your spouse died.
What do I need to do now?
HMRC says it has begun the process by writing to those already over pension age.
For the tens of thousands of those affected who have died, it will be a matter of tracking down the families of the deceased.
Sir Steve Webb, former pensions minister and current partner at LCP previously told The Sun: “The scale of this problem is such that it is going to take 18 months to try to track down all those who may have missed out.
“But HMRC’s records give them only very limited information about who to contact, so anyone who thinks they were eligible for Home Responsibilities Protection which may be missing from their state pension should check if they were entitled and put in an application.”
What is Home Responsibilities Protection (HRP)?
BELOW we reveal what Home Responsibilities Protection (HRP) is and why if you received it before 2000 you could be missing out on cash.
From 1978 to 2010, protection was provided for parents to avoid gaps in their “qualifying years” by a system known as Home Responsibilities Protection (HRP) credits.
This system was then replaced in 2010 by the one we have now, called National Insurance Credits.
Most people got HRP automatically if they were getting child benefit in their name for a child under the age of 16 and they had given the child benefit office their National Insurance (NI) number.
If someone claimed child benefit before May 2000 and did not provide their NI number on the form, it’s possible that their credits may not have been transferred to their NI account from the child benefit computer.
This may affect their pension entitlement and women who are now in their 60s and 70s are most likely to be affected.
If you think you may be entitled, but you have questions, the Pension Service can be reached using the Gov.UK website or by calling 0800 731 0469.
Anyone who has received child benefit since 1978 should check their NI record.
If the payment is missing, there is a form that can be filled in to get the information added to your record.
It is called a CF411 form and it can be found on the government’s website.
You can also contact the HMRC National Insurance helpline for an application form.
Your state pension will then be automatically recalculated and the arrears will be paid.
You can still apply for HRP if, for the full tax years (April to April) between 1978 and 2010, if you were either:
- Sharing the care of a child under 16 with a partner you lived with and they claimed Child Benefit instead of you
- Caring for a sick or disabled person
Any HRP you had before April 6, 2010, have converted to National Insurance credits.
You must have reached state pension age on or after April 6 for these credits to go towards your pension.
You can also use HMRC’s eligibility checker at www.gov.uk/home-responsibilities-protection
Elsewhere, the exact amount you need to retire comfortably – including holidays abroad – has been revealed.
Plus, a Martin Lewis fan has revealed how the expert’s little-known tip helped them to boost their state pension by £7,000.
What are state pension errors?
STEVE Webb, partner at LCP and former Pensions Minister, explains what state pension errors are and how they can occur:
The way state pensions are worked out is so complicated that many thousands of people have been paid the wrong amount for years without even realising it.
The amount of retirement pension you get usually depends on your National Insurance (NI) record.
One big source of errors has been cases where NI records have been incorrect, particularly for years spent at home with children.
This is a system known as ‘Home Responsibilities Protection’.
Alternatively, particularly for older pensioners, the amount you get can depend on the NI contributions made by your spouse.
Errors have arisen where the Government has failed to adjust the pensions of married women when their husbands retired or failed to increase pensions when someone was bereaved and lost a husband or wife.
Although the Government has spent years trying to fix these problems, there are still many thousands of people – many of them older women – on the wrong pension.
If you have always thought that your pension seems low, then it is worth contacting the Pensions Service to ask them to check, especially if you spent time at home raising children or if you were widowed and your pension didn’t change when your spouse died.
Do you have a money problem that needs sorting? Get in touch by emailing money-sm@news.co.uk.
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