Matt Rodda MP: ‘Pensioners are terrified that their money has simply disappeared’
Pensioners are ‘terrified’ their money spent on state pension top-ups has ‘simply disappeared’, a Labour Shadow Minister told the Government in parliament yesterday.
The Department for Work and Pensions was urged to ‘get a grip of this terrible problem’ by Matt Rodda MP, who cited our investigation into cases of people handing over hundreds or sometimes thousands of pounds then trying to hunt it down for months.
People whose cash has apparently gone missing have struggled to get answers out of the DWP or HMRC, which between them run the system for making voluntary payments to boost state pensions.
Readers contacted us telling of their fears their money has simply disappeared into a ‘black hole’.
Of the six cases we recently flagged to the Government, five are now resolved and the other is still being probed.
But since last week’s story on the rolling chaos in the state pension top-ups system, we have received a flood of further messages from frustrated savers.
Some paid money to the Government at the end of last year, and one claims they handed over £11,500 in March and have made dozens of calls to no avail.
Buying top-ups can give a generous boost to retirement income if you buy the correct years on your record – see the box below. The state pension is currently worth £10,600 a year if you qualify for the full rate.
Rodda said that our investigation ‘showed that the Government are failing to accurately record people’s top-up contributions’.
Labour’s Shadow Pensions Minister told the House of Commons: ‘As inflation rises, being able to top up pension contributions is vital for many part-time workers, who would otherwise not be able to claim the full state pension.
‘Pensioners are terrified that their money has simply disappeared, so when will the Government get a grip of this terrible problem? When will Ministers show that they understand the pressure on families and pensioners due to the cost of living crisis?’
The Conservative Pensions Minister, Laura Trott, replied: ‘With the comprehensive package of support I have talked about today, we have shown that we are taking action during the cost of living crisis to help pensioners as much as we can.
‘We know that accuracy is the most important thing when it comes to the state pension, which is why we have taken action very quickly to correct issues where they have occurred, for example, with LEAP.
‘We will do the same in all such cases.’
‘LEAP’ is the corrections exercise launched by the Government after former Pensions Minister Steve Webb and This is Money discovered tens of thousands of elderly women had been underpaid state pension.
We began raising the alarm about this in early 2020 and spent months campaigning for a full investigation into women’s pension shortfall, which is now estimated at £1.2billion.
After his call for action in parliament yesterday, Mr Rodda later tweeted: ‘This Government is failing pensioners, losing records of people’s pension top-ups, and threatening some part-time workers’ state pensions as a result.
‘An independent report has shown a number of pension top-ups have been inaccurately reported by HMRC. Today, I questioned what the government is doing about this unacceptable mistake, and held them to account for their failings.’
What problems are savers having buying state pension top-ups?
The state pension top-ups system descended into chaos early this year, when savers jammed phonelines ahead of a crunch deadline – ultimately forcing the Government to extend it twice.
Now the previous rush has apparently caused a backlog in processing payments by HMRC, and then updating state pensions which is the DWP’s responsibility.
But savers don’t receive receipts or acknowledgements when they make payments. And when their cash appears to go missing in one or other department or between them, they cannot tell if it is just sitting in a queue, temporarily mislaid or actually lost.
Their worry is compounded when they ring up and DWP and HMRC call handlers cannot give them any information.
Having trouble with top-ups? Email [email protected]. Please put STATE PENSION TOP UPS in the subject line.
If you need help, you should also contact your MP.
This post first appeared on Dailymail.co.uk
