A quarter of a million people aged 70 or over aren’t getting paid any state pension at all – but thousands could be able to make a claim, according to new research by consultancy Lane, Clark and Peacock (LCP).
It found the latest population estimates from the Office for National Statistics (ONS) show there are 8.78 million people in Britain over the age of 70, but only 8.53 million are receiving a state pension – a difference of 250,000.
Of these, 107,000 are over 80 years old and could be owed a special state pension for those who qualify under the ‘old’ state pension system and many others may be entitled because they were married. In one case we’ve seen a 73-year-old woman who had no state pension but now gets a weekly payment and is owed £20,000.
Here, Which? looks at why so many people could be missing out on a state pension, who qualifies, and how to claim.
Why 250,000 get no state pension
There are several legitimate reasons why some aged over 70 would not be claiming a state pension.
- Long-term deferral You don’t have to take your state pension when you reach state pension age (SPA) – which is currently 66. Some people choose to defer their state pension for several years so they can boost their payment, and/or continue to work.
- Big National Insurance gaps For people who reached state pension age before 6 April 2016, the state pension runs under a ‘contributory’ system until age 80. They should therefore receive the basic state pension (£137.60 a week in 2021-22), but only if they have 30 years’ worth of NICs. This means many people may not have built enough NICs in their working life to receive any state pension.
- Getting other benefits instead Some people receive certain disability benefits or carers benefits past pension age which can reduce or eliminate their entitlement to a state pension.
However, the LCP report says these reasons only explain a fraction of the ‘missing’ state pensions.
It notes that only a small number of people will defer into their 70s plus there’s no evidence that the proportion of people with no state pension declines with age. So even if people defer into their early 70s but claim in their late 70s it wouldn’t have much effect on the figures.
In addition, even those with a very poor NI record in their own right may still be able to access a state pension (more on this below).
The over 80s missing a state pension
LCP estimates that 65,000 women and 42,000 men in Britain aged over 80 make up a large cohort of those not receiving state pensions.
Reasons for this may include:
- Awareness Some may not realise they can make a claim.
- Language barriers For example, people who’ve entered the UK from overseas later in life may not have English as a first language, which may further reduce awareness and/or increase barriers to claiming.
- Documentation issues Those that came to the UK from overseas could find there are issues around home country documentation not being accepted in the UK, or they haven’t obtained a National Insurance number.
- Mental capacity Some people may have reduced mental capacity as they get older, meaning they may not be able to cope with issues like claiming a state pension.
Find out more: how NI contributions affect your state pension entitlement
Who could be eligible to claim?
LCP estimates that over 100,000 people could qualify to claim a state pension worth a combined £400m.
There are two main groups of people who should be able to get a state pension.
1) Those aged 80 or over
For those who are aged 80 or over, the UK pension system has a special pension payable at a rate of £82.45 per week in 2021-22 for those who qualify for the old state pension (reached SPA before 6 April 2016). This is known as the ‘Category D’ pension and doesn’t depend on your NIC record for eligibility.
There are only three main requirements for entitlement – being aged 80 or over, not already getting a pension at this rate, and satisfying a basic residence test.
People who reached state pension age on or after 6 April 2016 will qualify for the new state pension; unfortunately, over-80s in this group will not be automatically eligible to claim. The full level of the new state pension is £179.60 in 2021-22, but you only need 10 years’ worth of NICs to get anything at all.
2) Women with husbands claiming a state pension
Married women who have a husband (or a civil partner) and are getting a basic state pension can usually claim their own state pension based on their husband’s contributions, provided they are also over state pension age.
If the husband is getting a basic state pension these women are entitled to 60% of the basic state pension their husband gets at SPA. The full basic state pension is currently £137.60, so the rate for married women claiming on this basis would be £82.56 per week. If the husband is getting less than the full amount, the amount the wife gets is reduced pro-rata. A wife can claim this pension even if the husband has ‘deferred’ taking his pension.
In rare cases, a husband can claim based on his wife’s contributions, but usually, it is the other way round.
‘I’m 73 and had no state pension but now I get £82 a week’
Bernie Weallans, 73, lives in Brighton with her husband.
She was born in the Netherlands and received no state pension in her own right because most of her paid work was outside the UK. Her husband, Martin, 70, is a British Citizen and receives a state pension. They both worked in the oil industry, and have been married for over 40 years.
Mrs Weallans contacted LCP partner and former pensions minister, Sir Steve Webb, because she had read reports that some women were being underpaid their state pension.
After getting in contact, she discovered she could have claimed a married woman’s state pension once her husband retired. Now she gets a regular pension of £82 a week and is owed arrears of over £20,000.
Mrs Weallans says: ‘when I saw the recent coverage it made me wonder if I should be getting a pension and I was delighted when my application was successful. I would encourage any other woman who is not getting a pension to check whether she is entitled to anything.’
- Find out more: the women missing a state pension
How to claim a missing state pension
Usually, those approaching state pension age will get a letter inviting them to claim their state pension, which can be filled in online or sent in the post.
If you think you’re owed a state pension and are under the age of 80, you should contact the government’s Pension Service to see if you’re eligible.
A separate analysis led by LCP found that a combination of complex rules around women’s entitlement under the old system and government computer errors has meant tens of thousands of married, divorced and widowed women could have been underpaid their state pension. DWP is now refunding women and plans to correct the issue by the end of 2023.
Find out more: how do I qualify for the state pension?