Under the current rules, you need 35 qualifying years on your National Insurance record – some people may need more – to claim the full new state pension. You normally need 10 years to receive anything at all
Pensioners who topped up their National Insurance records have been issued a warning as they could potentially be waiting months to see their state pension increases.
The rush to buy state pension top-ups has reportedly caused a six to eight-month backlog in processing payments. This year was the final deadline to top up state pension payments by making voluntary National Insurance contributions.
Under the current rules, you need 35 qualifying years on your National Insurance record – some people may need more – to claim the full new state pension. You normally need 10 years to receive anything at all. If your record has gaps, you could receive much less than you expected, but you can make voluntary contributions to fill them.
Before April 5, you could buy back missing National Insurance years dating back to 2006, but now you can only go back up to six tax years. This Is Money spoke to retired civil servant Sharon Gray from Herefordshire who paid £6,000 back in March to top up her record.
When Sharon contacted both HMRC and the DWP to find out when she should expect her state pension payments to increase, she was told by a staff member that the current payment processing period was six to eight months.
She was also told by staff that pensioners who were already receiving their state pensions would not be prioritised. This means Sharon could have to wait even longer to see her state pension payments to rise. Sharon told This is Money that the staff member said: “We are just working our way through them and there is nothing you can do. You have to wait.”
However, the DWP has confirmed that it was prioritising the cases of people over 66 and has doubled staff working on top-ups. One the comments, a DWP spokesperson said: “We do not recognise these claims and we are prioritising customers over state pension age so they can receive the immediate support to which they are entitled. We have doubled the number of staff on the team and are working at pace to process payments to customers.”
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This is Money has also heard from two other pensioners who have been waiting months to receive their state pension top ups. One pensioner – who is set to start claiming their state pension this month – plugged their National Insurance gaps in November last year. However, their records have not yet been updated six months later. Another 66-year-old pensioner living in France updated their records in January this year but is still waiting to see their payments increase.
It’s important to note that if you are over 66, you will receive state pension arrears going back to the date of your top-up payment in addition to your increase, so you will not ultimately see a shortfall.
Commenting on the potential timeframe, former Pensions Minister Steve Webb said: “For those who are already over state pension age and short of a full pension, it cannot be right that they have to wait months to get their pension reassessed.
“The Government must have known that there would be a surge of payments in the weeks and months leading up to the final deadline and should have put in place extra capacity to keep processing times down.”
Webb, who is now a partner and pension consultant at LCP, added: “As things stand, people are losing out on the interest on hundreds or thousands of pounds in contributions and simply have to sit and wait until their case gets to the top of the queue.”
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