Bereaved households requested to return pension overpayments | EUROtoday

Bereaved kinfolk have been requested to repay state pensions that have been wrongly despatched to individuals who have died by the Department for Work and Pensions (DWP).

The DWP has confirmed it has no authorized proper to reclaim the cash however argues that it does so to guard public funds.

Former Pensions Minister Sir Steve Webb says the letter the division sends out to households doesn’t make it clear the repayments are voluntary.

Over the previous 5 years, the DWP mistakenly paid greater than £500m in state pensions and pension credit to the deceasedrecovering about half from bereaved kinfolk.

This scenario can come up if there’s a delay in reporting a dying – or within the DWP processing it – inflicting additional pension funds to be issued.

As a consequence, a part of that fee might cowl a interval after the individual has died.

In the newest yr, £144m was overpaid in state pensions by the DWP after an individual’s dying attributable to delayed reporting.

The division recovered £67.3m, leaving £76.7m in unrecovered overpayments.

Sir Steve, who’s a accomplice at pensions consultancy LCP, used a Freedom of Information request to see a duplicate of the letter the DWP sends out to households and executors.

It revealed that whereas the division asks for the cash to be returned to guard public funds, it doesn’t state that compensation is voluntary.

The former minister stated he was “shocked” to study the letter doesn’t make clear that returning the cash is not obligatory.

Sir Steve argued that this turns pension repayments right into a “lottery” the place some folks ship the cash again whereas others do not.

The former Liberal Democrat politician, who served within the ministry between 2010 and 2015, warned the system disproportionately impacts probably the most weak, who could also be grieving and unable to query the letter.

He known as for a “consistent approach”, urging the federal government both to safe a authorized foundation for recovering overpayments or cease benefiting from “people who don’t know how this system works”.

Radio 4 Money Box listener Dennis stated he had been “caught out” by the process twice, after each of his dad and mom handed away.

Dennis defined that he adopted the letter’s directions to “settle all” his dad and mom’ affairs.

He added that he “obeys the government and will pay it” as he did not know the compensation was not legally required.

Another Money Box listener, Jan, instructed the BBC that her late husband could be “absolutely beside himself” if he knew that over £250 of his pension had been paid again when it did not should be.

Jan stated she was confused when she obtained a letter from the DWP stating her husband had been overpaid, as she had knowledgeable them “immediately” after his dying.

“It was upsetting the way it happened and [the way] the whole thing played out,” she stated.

The Department for Work and Pensions stated in an announcement: “It is not our intention to cause distress, however, we have a responsibility to taxpayers to recover overpayments. We acknowledge this is not always possible.

“Whilst there is no such thing as a authorized obligation to repay a debt of this sort, we recognise some folks might be keen to repay cash to which there was no entitlement. We present full contact particulars and encourage anybody with issues to name us.”

For extra on this story hearken to Money Box at 12:00 GMT on BBC Radio 4 or make amends for BBC Sounds.