The UK government has acknowledged a serious mistake in state pension calculations that has resulted in underpayments for thousands of people, predominantly women. The error stems from missing Home Responsibilities Protection (HRP) credits, a scheme meant to support carers and parents who took time off work. HMRC (Her Majesty’s Revenue and Customs) has contacted 370,000 individuals, informing them of potential entitlements to a refund, which averages £7,859 per person.
This guide explains the issue in detail, who is affected, how to check your eligibility, and steps to claim your rightful refund.
HMRC Confirms £7859 Pension Payout Error
| Aspect | Details |
|---|---|
| Cause of the Error | Missing HRP credits from National Insurance records |
| Who Is Affected? | Stay-at-home parents, carers, and those claiming Child Benefit (1978–2000) |
| Average Refund Amount | £7,859 per individual |
| Agency Handling Claims | HMRC and the Department for Work and Pensions (DWP) |
| Official Website for Help | GOV.UK Pension Checker |
What Is Home Responsibilities Protection (HRP)?
HRP was a scheme introduced to help parents and carers secure a full state pension despite taking time off work. It reduced the number of qualifying years required to claim a full state pension. In 2010, HRP was replaced by National Insurance credits, but the transition exposed gaps in record-keeping.
The Cause of the Error
The root of the issue lies in the Child Benefit claim forms used before 2000, which did not require individuals to provide a National Insurance number. As a result, many eligible individuals did not receive the HRP credits they were entitled to, leaving them with incomplete National Insurance records.
Who Is Most Likely to Be Affected?
The following groups are at the highest risk of being affected by the HRP-related underpayments:
- Stay-at-home parents, particularly mothers, who claimed Child Benefit between 1978 and 2000.
- Individuals who claimed Child Benefit in their own name, not under a spouse’s or partner’s name.
- Those who were not paying the “married woman’s reduced stamp” National Insurance contributions.
- People who reached state pension age on or before April 5, 2010.
Financial Impact: How Much Money Is Involved?
As of September 30, 2024, the government has identified 5,344 cases of underpayment and refunded a total of £42 million in arrears.
While 370,000 individuals have been contacted about potential errors, the scale of the problem is likely larger, as an estimated 43,000 eligible individuals have already passed away without receiving their refunds. Families of deceased individuals can still claim this money on their behalf.
How to Check If You Are Affected
If you believe you might be affected, follow these steps to confirm your eligibility and take action:
Step 1: Check Your National Insurance Record
If you reached state pension age after April 5, 2010, review your National Insurance record online or through HMRC. Ensure HRP or National Insurance credits are listed as complete qualifying years for the relevant period.
Step 2: Contact the National Insurance Helpline
For those who reached state pension age on or before April 5, 2010, HRP was recorded differently. Contact the National Insurance helpline directly to confirm whether your records reflect HRP entitlements.
Step 3: Use the Government’s Online Tool
The UK government has provided an online checker on the GOV.UK website. This tool allows individuals to verify if their HRP credits are missing and identify any potential gaps in their records.
What to Do If You Are Affected
If your investigation confirms you have been underpaid due to missing HRP credits, take these steps to secure your refund:
- Gather Necessary Documentation:
Collect records of your Child Benefit claims, National Insurance contributions, and any related documents. These will support your case when filing a claim. - File a Claim:
Contact HMRC or the DWP to submit an official claim. They will review your records and make the necessary adjustments to your state pension. - Claim for Deceased Relatives:
If your deceased relative was affected, you are allowed to file a claim on their behalf to recover the money they were entitled to. - Stay Informed:
Follow updates on this issue through the official UK government website or news sources to ensure you don’t miss deadlines or changes in the claims process.
FAQs
1. What caused the underpayment issue?
The error was due to Child Benefit claim forms before 2000 not requiring National Insurance numbers, leading to missing HRP credits in the records of eligible individuals.
2. How can I check if I am affected?
You can check your National Insurance record, contact the helpline, or use the online tool provided by the government on GOV.UK.
3. How much money can I expect to receive?
Refunds vary depending on individual circumstances, but the average amount is £7,859.
4. Can families claim refunds on behalf of deceased relatives?
Yes, families of deceased individuals can file a claim to recover the money owed to their loved ones.
5. Is there a deadline for filing a claim?
Currently, no specific deadline has been set, but it is advisable to act quickly to avoid complications.
6. What is the government doing to address this?
The government has set up a priority system to address underpayments for those most in need and created tools to help individuals verify their HRP records.