Warning as millions on Universal Credit could miss out on hundreds of pounds

02 February 2023 , 16:24

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If you're on benefits, and you meet all the criteria requirements, you can get credit towards your state pension as if you have been paying National Insurance (Image: Getty Images/iStockphoto)

Millions of people who claim Universal Credit could risk missing out on hundreds of pounds during their retirement due to "errors" in their National Insurance record.

An investigation by This is Money claims the system used by the Department for Work and Pensions (DWP) to update National Insurance credits automatically has either "never worked" or has "been broken since 2018".

The website claims suggests some people on Universal Credit were instead having their state pension record "manually" corrected when they were within four months of turning the state pension age.

This is Money claims this means some benefit claimants could potentially have their state pension underpaid and others could have wasted money buying top-ups to boost it which they didn't need to.

If you're on benefits, and you meet all the criteria requirements, you can get credit towards your state pension as if you have been paying National Insurance.

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It takes 35 years of Nation Insurance contributions to get the full amount of state pension and if you do not have this because you were not working, you can pay for the gaps to be filled.

One woman received £667 after This is Money took her case to the DWP after she attempted to chase the missing credits herself.

She said: "It is such a shambles, you get to retirement age and you are still fighting for things."

This is Money said it has uncovered "serious failings" by the DWP and points out that the Government website says Universal Credit claimants will "automatically" have the credit added to their records.

Since 2018, millions of Brits have claimed Universal Credit, with 4.8million having claimed the benefit as of August 2022.

The DWP told This is Money "there is no indication of a wider issue".

A DWP spokesperson said: "All of the cases raised have now been resolved and we are sorry for any inconvenience caused.

"We are working with HMRC on an improved process to add historic and future Universal Credit National Insurance credits to National Insurance records."

It also said that HMRC advises people to wait until Universal Credit credits are showing on their record before making any voluntary payments needed to make that a qualifying year.

If any payments are made unnecessarily, they can be then refunded.

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