The Waspi campaigners have certainly stung a few backsides at the DWP this week and I can’t help but admiring their pluck. This doesn’t necessarily mean I agree with the entirety of the argument but it is worth exploring why they are so determined and why they need to be listened to.
Whatever you think about the merits of their case, I do think it highlights a much bigger chasm at the heart of the UK State Pension Scheme. Much of this is related to poor communication and the high handed way the DWP and others treat pension savers.
Want an annual State Pension statement for your contributions? How dare you?
Of course, most financial advisers and many in the industry had written off Waspi as a group of well intentioned but misguided group of women. Surely they were told at the time they would lose five years of their State Pensions? The Parliamentary Ombudsman thought otherwise.
A big issue now is moving all this forward and the cost.
It’s also worth looking at how much it would actually cost in total to back date State Pension payments to the estimated 3.8m women (Waspi estimate) affected by the rise in women’s pension age from 60 to 65 from 2015 onwards. Many of the women affected have quoted a ‘loss’ of about £45,000 each (BBC reports). My very rough estimate is that to meet every claim would cost around £1,710bn and that doesn’t include the admin.
Even the Waspi campaigners accept that this kind of settlement is unlikely.
The culprit here is the UK government and its dreadful Department of Work and Pensions. Much of the women’s case is that there was a lack of communication from the DWP on the changes which would ‘steal’ their pensions from them. Here I have a great deal of sympathy.
One thing is obvious, the DWP fully deserves getting its bottom being kicked over its dreadful approach to communication. Anyone received a State Pension annual statement recently? Want to know what your State Pension forecast is or want to know your State Pension retirement age? – have a go on the DWP website…if it’s working. State Pension communication from the DWP is either abysmal or virtually non existent.
This lackadaisical approach to pension communication is truly appalling and I fully accept that many of the women were not aware of the fact their pensions were being delayed by several years. Many clearly expected their State Pensions to kick in from 60.
Where Waspi has a problem is that it is realistically too late to compensate all the women who lost out. The time to have kicked up a fuss was back in the mid-90s when all this was being pushed through Parliament. Too settle all the claims, as we’ve seen, would probably cause the Exchequer to collapse and would increase taxes for everyone by a huge sum.
Unlike France, most UK pension savers have accepted that the price for a longer lifespan is a delayed State Pension, which is, of course a benefit and not a right (one to debate later).
Whatever you think about the Waspi campaign at least it has shone a welcome light on pension unfairness, particularly for women, a topic I shall be returning to. In terms of the Ombudsman’s ruling the government should pay up.
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Kevin O’Donnell is editor of Financial Planning Today and a journalist with 40 years of experience in finance, business and mainstream news. This topical comment on the Financial Planning news appears most weeks, usually on Fridays but occasionally other days. Email: This email address is being protected from spambots. You need JavaScript enabled to view it. Follow @FPT_Kevin >Top Tip: Follow Financial Planning Today on Twitter / X @_FPToday for breaking news and key updates
