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Stay at home mom in the 80s or 90s? You may owe £80,000

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Helen James was shocked to learn last year that she was not entitled to a penny of her state pension.

Grandma always assumed she would get help as she worked a variety of jobs, including one role at a school and another at a local shop.

But civil servants pointed to a 12-year career break she took from the late 1970s to care for her two children.

owe you? Experts are urging those who took time off work to care for children in the 1980s and 1990s to check whether they are being paid more by state pensions

They told her she did not meet the minimum requirement of ten years of National Insurance (NI) contributions to receive even the smallest weekly pension payment.

It has since emerged that officials at the Department for Work and Pensions (DWP) were wrong in their assessment. Helen, 67, from South Wales, is just one of thousands of pensioners who may have been affected by similar mistakes.

Historical failures

The errors arose because changes to the way NI contributions are calculated for stay-at-home parents were not taken into account.

Now experts are urging those who did not work to care for their children in the 1980s and 1990s to check whether they are being underpaid. They may be eligible for payments of up to £80,000.

In Helen’s case, she got back £4,000 and is now entitled to a state pension of £79 a week.

“It’s completely wrong to be told I’m not eligible for a pension,” she says. “If my daughter hadn’t read the press coverage of this issue, I might still have gotten nothing.”

Check if you are entitled to a payment

Parents can check their NI records at gov.uk/check-national-insurance-record or by calling 0300 200 3500.

If you reached pension age after 5 April 2010, Home Responsibility Protection (HRP) credits must be shown as an NI year in your records.

Older parents should call the trust to ask if HRP has been added for the years they have been out of work.

If you think you’ve been let down, ask for form CF411 or download it online and send it to HMRC. For details visit lcp.uk.com/mothers-missing-millions.

It is the latest in a long line of scandals to rock the DWP in recent years. In 2020, an investigation by former pensions minister Steve Webb and our sister website This Is Money revealed that tens of thousands of people – mostly women – were being grossly underpaid in their pensions.

The mistakes date back to 1985 and relate to the failure to increase their state pensions in line with their husbands’ debt.

In July, a DWP report showed that around 221,000 people had missed out on vital state pension payments due to historic admin errors – a 67 per cent increase on the previous forecast of 132,000. £3 billion.

The report also details a new error: credits for time spent at home caring for children – known as domestic duty protection – were not recorded accurately in some NI records.

The DWP said it was the second highest number of underpayments. Sir Steve Webb, now a partner at consultants LCP, says: “The DWP has admitted that even more people are receiving an underpaid State Pension than previously thought and a whole new category of error is being revealed.

“It certainly means that many thousands of people have been underpaid for years.”

Ross Altman, another former pensions minister, adds: “It’s so sad. . . Women became the victims again.”

To qualify for the full new state pension – of £185.15 a week – you must have accumulated 35 qualifying years of NI contributions. Any years that have been “contracted out” in exchange for lower premiums will not be included.

Those who retired before 6 April 2016 are entitled to £141.85. If you have accumulated NI contributions for more than ten years but less than 35 years, you will receive a lower weekly payment.

Mistakes: In July, a DWP report showed 221,000 people missed out on vital state pension payments due to historic administrator errors - a 67% rise on the previous forecast of 132,000.

Mistakes: In July, a DWP report showed 221,000 people missed out on vital state pension payments due to historic administrator errors – a 67% rise on the previous forecast of 132,000.

Increase in income

Since 1978, mothers and fathers have been able to keep their pension if they take parental leave and receive child benefit.

For stay-at-home parents who reached pension age before 6 April 2010, the DWP was to reduce the number of years of contributions needed to qualify for the state pension.

Those who retired after that date should have received NI credits for each year their parents stayed at home. The DWP is working with HMRC to find out how many people have been caught, but no update is expected until the autumn.

Meanwhile, LCP has launched a campaign to encourage pensioners to find out if they are underpaid by checking their NI records online or by phone.

Those who believe their contributions have not been recorded correctly can send a claim by post to HMRC.

Lorraine Wainwright was able to increase her weekly pension by £20 a week by doing just that.

Like Helen, the mother of two spent most of the 1970s and 1980s staying at home looking after her children. However, she later returned to work and ran a nursing home with her husband, Eddie, 67.

When Lorraine, now 68, first applied for her state pension in 2020, she was told she had only accumulated 31 qualifying years of NI contributions so would not receive the full new state pension.

But with Sir Steve’s support, she lodged a claim with the DWP this year, reclaiming £1,500 of underpayment as well as her weekly increase.

Lorraine, who lives in Gloucestershire, said: “I would encourage all parents bringing up their children to check that they are getting credit on their NI records. If I hadn’t checked my own report carefully, it’s possible that I would still be getting the wrong pension.’

A government spokesman says: “This year we will spend more than £110 billion on the state pension and support more than 12.5 million pensioners. We are investigating the issue with the history of domestic responsibilities protection and are working to identify those affected.”

  • Were you underpaid? Write to us at moneymail@dailymail.co.uk or Money Mail, Northcliffe House, 2 Derry Street, London W8 5TT.

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