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The Department for Work and Pensions (DWP) mistakenly sent more than half a billion pounds to deceased pensioners over the last five years, official figures have revealed, with most of this left unrecovered.
Since 2019, £512m has been overpaid in state pension and pension credit, of which only £255m has been sent back. The largest sum of overpayments was made just last year, when £159.2m was transferred.
The data was shared by Labour MP Andrew Western in response to a written question by Reform MP Rupert Lowe in Parliament. The government under-secretary says the DWP is working to recover the overpayments to “avoid this becoming a long-term cost to the taxpayer,” adding that the overpayments represent 0.1 per cent of total annual expenditure on pensions.
However, progress is slow on the recovery process as there is no legal obligation for greiving families to return the money. Mr Western explains that the overpayments are “treated as non-recoverable and are not enforceable by law”, but says the DWP “can request the money back as a voluntary payment.”
The figures show that £458 million was mistakenly paid in state pension, with just £233 recovered. Meanwhile, £54 million was wrongly paid in pension credit, with only £22 million recovered.
Under current rules, a person’s death must be reported within five days, or eight days in Scotland. Both the new and old state pension is paid in arrears, while pension credit is only paid in arrears for those on the new system. This means it can be quite common for payments to be made after a person’s death.
Former pensions minister Steve Webb, now of LCP, said: “With pensions routinely paid four-weekly in arrears, it is common that part of any final payment will cover a period after the person has died, even if the family contact DWP promptly.
“With everything else that the family is dealing with, letters from DWP trying to recover overpayments are unwelcome and should only be sent out if there is a legal basis for them,” he told The Telegraph.
