The Department for Work and Pensions (DWP) has been undertaking a correction exercise since 2021 to fix previous state pension errors. 

Sir Steve, partner at LCP, said he had found evidence of a new group of cases where incorrect information was given. The cases involved people claiming the new state pension who were already widowed when they retired.

Sir Steve, who was Pensions Minister from 2010 to 2015, said he had been contacted by four separate people who had not been awarded any inherited state pension when they retired and had been told in writing or over the phone by the department that they were not entitled.

In all four cases, that was incorrect and an increased amount of state pension has been arranged and arrears have been paid. In two of the cases, the underpayment amounted to more than £2,000 per year, which could potentially add up to a £40,000 shortfall over a typical retirement. 

In general, the new group appears to include those who are widows or widowers at the point when they claim their new state pension and where either the spouse who has died reached pension age before 6 April 2016 or where they died before 6 April 2016.

The exact amount of inherited state pension depends on individual circumstances, but could be higher if the late spouse was an employee, rather than self-employed and the widowed spouse is not receiving a widow’s pension from a company pension scheme (as this may replace part of any inherited state pension due).

Sir Steve said: “Having had to spend years checking hundreds of thousands of historic state pension calculations for errors, you would hope that DWP would be making sure that new claims are handled correctly. But we have found worrying evidence that this is not the case.

“There seems to be a particular problem for people who are widows or widowers when they claim their state pension. In some cases DWP seems to have failed to automatically add any inherited state pension they were due from a late partner. These cases may well be the tip of an iceberg.”

LCP has developed an online tool to help people understand what state pension they are entitled to inherit on top of their own state pension. Sir Steve called for the DWP to launch an urgent investigation into the scale of the problem.

A DWP spokesperson said: “We want to ensure pensioners receive all the support to which they are entitled and have a tool to help them understand what state pension they can inherit. Delays can occur to a customer’s state pension award when not all the information we need is provided.

“In these cases, we will make a state pension award based on the customer’s own national insurance record until we have the required information. Once we have the necessary documentation, we will then revise the customer’s claim as soon as possible.”