The DWP’s Legal Entitlements and Administrative Practice (LEAP) exercise to correct underpayments of the State Pension.
People who reached State Pension Age (SPA) before April 2016 can claim basic State Pension. To get the full basic State Pension an individual needs a total of 30 qualifying years of National Insurance (NI) contributions or credits. When someone has less than 30 qualifying years, their basic State Pension will be less than this amount. There were different rules in place for those who reached SPA before 6 April 2010.
If an individual, who reached State Pension age before 6 April 2016, has insufficient NI contributions themselves to qualify for a basic State Pension, they may be able to derive entitlement from their spouse or civil partner (an uplift based on their partner’s NI contributions called a Category BL State Pension).
Those who are widowed, and are getting a basic State Pension of less than £169.50 a week (in 2024/25), can also derive basic State Pension from their late spouse or civil partner. This may give them a basic State Pension of up to £169.50 a week. They can also inherit between 50% and 100% of any additional State Pension and 50% of any Graduated Retirement Benefit. The category of people whose State Pension was not increased to include any amounts they are entitled to inherit from their late husband, wife or civil partner is described as ‘Missed conversions’.
People who reach age 80 and are getting no basic State Pension or a basic State Pension amount of less than £101.55 a week (in 2024/25), may, subject to satisfying the appropriate residency conditions, qualify for a Category D State Pension of £101.55 a week.
In 2020, the Department for Work and Pensions (DWP) became aware of a number of individuals who had not had their State Pension increased, in accordance with the law, automatically when this should have occurred. This prompted the department to take action to investigate the extent of the problem. This publication includes information on the progress of the LEAP exercise to check and correct individual cases, and the amount of arrears repaid to 31 March 2024. It says that the LEAP exercise has now completed two of the three customer groups: the Cat BL and Cat D cases. It says that those remaining are cases where DWP is awaiting further information from a customer or a third party, and these will be cleared on receipt. The expectation is for the exercise to be completed for the third group, ‘Missed conversions’, by the end of 2024. Customers have up to two years to return information, so there may continue to be a small number of Cat BL and Cat D cases through to 2025 and missed conversions to 2026.
It has identified 860,271 cases that need to be reviewed and has reviewed 731,717 of those cases to 31 March 2024. The checking process has identified 99,558 underpayments, and State Pension underpayments made to married individuals, widows/widowers and people who have reached age 80 who are being underpaid State Pension because their current payment does not include additional entitlement, total £594m between 11 January 2021 and to 31 March 2024.
The table below shows progress by category:
Notes to the table:
- Cases may be checked for more than one potential cause of error; therefore, an individual State Pension claim may be counted in more than one category.
- Cases reviewed includes cases which have been deemed out of scope of the LEAP exercise through an automated process.
- These are cases for which a current or historical underpayment of State Pension has been identified. This may include cases for which a corresponding overpayment of another benefit (for example, Pension Credit) has occurred as a result, meaning that there was no net underpayment to the individual as well as some cases where the customer is deceased, and DWP has so far been unable to identify an estate to which to pay the arrears due.
- This average includes cases where the arrears amount owed is £0 due to offset of another benefit already paid such as Pension Credit. Current estimates of the total arrears due is £970 million to 133,000 pensioners and recognised a provision of £369 million, reflecting the outstanding amounts it still expects to repay. Last year it was estimated that DWP underpaid £1.17 billion to 170,000 pensioners. The final total value of the underpayments will only be confirmed by the completion of the exercise.
In addition, the DWP’s report lists issues identified with cases of State Pension awards which appear to have arisen from historic recording of Home Responsibilities Protection (HRP) (administered by HMRC) on claimants’ NI records. HRP was a scheme to help protect parents’ and carers’ State Pensions, reducing the number of qualifying years needed for the full basic State Pension. It has identified 194,000 cases that need to be reviewed and has reviewed 419 of those cases to 31 March 2024. Underpayments made total £2.2m to 31 March 2024.
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