Exclusive: The great DWP rip off – Not one person out of a potential 11 million has won compensation for losing thousands of pounds of extra pension

Peter Schofield, DWP permanent secretary Pic credit: gov.uk

Those who follow my blog may remember I have been highlighting a horrendously complicated story of the plight of people who contracted out of SERPS but were told they would receive an index linked guaranteed minimum pension. This arrangement was scrapped when the new state pension was introduced in 2016 for anyone in the private sector – but remains for public sector workers.

This decision was never debated in Parliament or included in the Pensions White Paper and has meant the government got away with not paying out anything from a £1000 to tens of thousands of pounds over the lifetime of their pension, depending on how long they were contracted out by their employer from the old SERPS scheme. The numbers could be as high as 11 million and women would be the worst affected.

Rob Behrens Parliamentary Ombudsman

The Parliamentary Ombudsman, Robert Behrens, was asked to investigate and concluded that there had been maladministration and two people shared £1250 compensation. Unlike the row over the 50s and 60s born women who lost out by not being informed by the government over the rise in their pension age, no record exists, as far as I can find out, of the ministry repealing this provision in the 2014 Pensions Act.

In September 2019 the Ombudsman gave the ministry three months to sort out this issue. He asked the ministry to “review and report back on to us on the learning from this investigation, including action being taken to ensure that affected individuals receive appropriate communication from the DWP about their state pensions. “

The DWP ignored the Ombudsman’s request and only last August -in the middle of the summer recess – put up a fact sheet to inform people. There is no reference to the Ombudsman’s report, and the fact that people could be entitled to compensation. There is no mechanism for people to apply for the compensation and the notice was not even accompanied by a press release. The figures used to say how much people underplayed what people lost. And the Ombudsman wimped out of pressing the government to do anything.

Stephen Timms MP, took up the case and sought answers from the DWP

Now this month the results of these devious ploys have been revealed in a letter to the Commons Work and Pensions Committee after Stephen Timms, its chairman, took up their cause.

Not ONE person in the UK has received any compensation and only four people have written to the Department about it. None of the four were entitled to extra money. Given the deliberately obscure way the fact sheet was constructed and the lack of a mechanism to apply for compensation – it is hardly surprising. The Department is also insisting that these people are better off- because the triple now double lock – has given them more money. But that is a universal payment and pales into insignificance when you think of thousands of pounds many of the people have lost.

I expect Therese Coffey, the Secretary of State and Guy Opperman, the pensions minister, were probably holding a joint celebratory karaoke session in their offices – as they had avoided paying out an extra penny to the people they had deprived of compensation.

Therese Coffey, Secretary of State Pic credit: Twitter

The level of deception was heinous given that Chris Thompson, a reader who has enormous knowledge about GMP, had put in a freedom of information request to find out how many people had contacted the DWP to request compensation. He was told it was ” too expensive ” to give him the information. What mendacity by officials, how expensive is it to tell them that nobody got it and just four applied.

This sorry tale bodes ill for the 50swomen who are fighting for compensation for a similar pension maladministration – it is obvious that officials and ministers in this case have perfected a procedure to be as obscure as possible and not create any mechanism to claim compensation. Also they can’t rely on the Ombudsman to stick by them – in this case he wimped out and didn’t even hold the DWP to the fire to do what he asked them.

This is yet another example of a ministry that has no interest in justice and can rely on bamboozling the public and fake excuses for not replying to freedom of information requests.

Peter Schofield, permanent secretary at the DWP, has promised a review of the fact sheet now. I am not holding my breath.

The letter – the horrendous disclosure is at the bottom

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11 thoughts on “Exclusive: The great DWP rip off – Not one person out of a potential 11 million has won compensation for losing thousands of pounds of extra pension

  1. This is an absolute travesty!!!

    On Tue, 1 Feb 2022, 19:05 Westminster Confidential, wrote:

    > davidhencke posted: ” Peter Schofield, DWP permanent secretary Pic credit: > gov.uk Those who follow my blog may remember I have been highlighting a > horrendously complicated story of the plight of people who contracted out > of SERPS but were told they would receive an index ” >


  2. I am one of the FEW people who defeated the DWP at a First Tier Tribunal in Jan last after the the thieving scoundres at the DWP had robed me of 50 % of my OAP. The FTT Judge (G Bird) upheld my appeal and ordered the DWP to repay my money but the bastards have not repaid the stolen money yet.


    • surprised you got that result in such an obviously corrupt system…..but how do you expect to enforce it, in an obviously corrupt system? I had similar results…never enforced, homeless and destitute for over 16 years now. You’re just wasting money on lawyers, best case scenario.


  3. The scale of the problem is truly staggering now. It’s not just on pensions either, I know from personal experience it’s the whole benefit system. Money has been paid into the pot in a lot of cases, but the people it is meant for don’t get it….so where do you think it goes? How many ghost claimants are there? How would they even know when nobody will investigate? It’s like the classic cashier con…the bill is 7 pound something, you pay with a twenty…cashier gives you change for a tenner. Now it has been proven that only 10% query the mistake, in which case cashier gives them the missing tenner and apologises for the ‘mistake’….the other 90% lose their money.


  4. Dear David Hencke,
    All public sector pensions were contracted out of SERPs, not needing our consent, from April 1978 onwards by Labour’s Callaghan government.

    SERPs began in 1975 under Labour’s Harold Wilson’s government.

    The flat rate state pension abolished SERPs from 2016, as the flat rate state pension is called single tier state pension, using 2014 pension act.

    Those still in work are all now, since April 2016, back paying the full 12 per cent standard worker National Insurance contributions.

    When we were contracted out, workers paid 10 per cent NI contributions, and the boss got 3.8 per cent rebate from his employer NI contributions, per waged worker.

    The Guaranteed Minimum Pension supposedly offsets the loss of SERPs for those still working and were inside the SERPs opt out since 1978.

    Us retired since April 2016 will never get the full flat rate, even with the maximum 50 years NI history, because we were opted out of SERPs. Leaving us with practically an individual state pension between most ladies and half of men contracted out of SERPs.

    The majority of public sector employees are low waged women (around 70 per cent of membership of UNISON public sector trade union are women).

    What you are talking about was in private pensions, where you could make a choice to opt out or not from SERPs … “The private hell of pensions: Of the six million who left Serps for the private pension train, more than 2.4 million were taken for a ride. Helen Kay looks at the selling of inappropriate savings products” Helen Kay Sunday 27 March 1994.


  5. Dear David Hencke,
    As a means to gain support from new political parties and potential new party by Jeremy Corbyn (?) I’m putting up an election manifesto (website work in progress) that includes the means to end the loss of state pension due to SERPs opt out (1978 to 2016) and loss of prior version of triple lock between 1980 and 2010.

    The finance world informed of much higher amount of state pension we would have had if Labour’s Harold Wilson’s governments prior version of triple lock from 1974 and SERPs from 1975 had remained til today.

    This would now equate to the real living wage from the Living Wage Foundation, of £380 per week state pension, which the party that does not yet exist, would pay tax free, to all pensioners old and new, regardless of National Insurance record (including if opted out of SERPs), within the UK National Insurance system.

    Right wing Labour between 1997 and 2010 continued the Tories’ not paying the triple lock, and the SERPs opt out system.

    The Lib Dems Pension Minister within the Tory government between 2010 and 2015, used the SERPs opt out to reduce the new flat rate state pension, so hitting women yet again, who rely on the state pension even more than men.

    And leaving behind the 1950s ladies retired before 2016, on the old lesser basic state pension.

    Admin Grey Swans pension group


  6. I warned of the SERPS scam and aim to raid the triple lock benefits. As late as last year, TPAS were advising that, under the guaranteed minimum pension element of SERPS my private pension would, at least, have to match the amount appropriated from my state pension. I suppose the DWP have been extremely busy attending lockdown parties to have a care about cheated and starving pensioners! Boris, the man who cannot recognise a party when he is at one, when in need of any money seeks, in the first instance, how he can deprive the pensioners of more income. He has now proved he can behave as badly as he chooses and there is no-one to stop him and no repercussions. And they have the cheek to call this a democracy! Once again, I ask: ‘what happened to the £271 billion NI pot?’


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