The Government has rolled back a revamp of state pension forecasts after an outcry from savers who contacted This is Money to complain.
Our readers were baffled by the changes, which they told us made it harder to understand what they needed to do to get a full pension.
They said the online tool, widely used by people to find out what they will retire on, now seemed to imply that they need to keep contributing even if they would already get a full state pension, currently worth £221.20 a week.
Information about filling past gaps was also presented in a ‘confusing’ way, they told us.
A Government spokesperson said: ‘Due to customer feedback these changes have now been withdrawn. This means people will be able to view their state pension forecast as they were before. We apologise for any confusion caused.’
The new format was launched as many are checking forecasts ahead of a crucial deadline for a special deal to buy state pension top-ups and boost payments in retirement.
Up until 5 April, savers can pay to fill gaps in their state pension records dating back 18 years, after which it will revert to just six years.
Mark de Fleury, 58, an NHS worker who lives in Wiltshire, said of the new-style forecast: ‘Previously it showed how many years you need to reach your 35 years’ full contribution or indeed that you have paid the full amount.
‘It now seems to imply that you need to contribute right up to your actual retirement date.’
Another reader told us the Government had ‘broken’ the state pension forecast page in the latest update.
‘It no longer tells you if you have contributed enough to date to get the full state pension. It tells you what your state pension will be if you contribute until state pension age instead.
‘If you already have full entitlement you get no confirmation.’
Elizabeth White, 63, a retired financial services worker who lives in North Yorkshire, appealed to This is Money to explain the ‘confusing new state pension forecast’.
She told us she rang the DWP’s Future Pensions helpline last month to ask if she needed to buy six missing years.
‘They said, no, that I am already eligible for the full state pension when I get to state pension age in three years, even though I have given up work early so won’t be contributing any more.
‘But now I have checked my state pension forecast again, the layout has changed. Worryingly, it now seems to say that I must make NI contributions right up to my state pension age. Do you understand what they have done? And why?’
Steve Webb, a former Pensions Minister who is now This is Money’s retirement columnist and a partner at LCP, said: ‘It does seem astonishing to change the format quite significantly just a couple of months before a make-or-break deadline.
‘You can see from our readers that they cannot have tested it much because we quickly heard how confusing it was. It’s good that it has been reversed and I hope that lessons have been learned!’
Many people carry on making NI contributions beyond the 35 qualifying years they need for a full state pension, because they are automatically deducted if you are still working, up until retirement age at 66.
But others who have already stopped work, or want to retire early, or need to for health or other reasons, want to know where they stand regarding a full state pension – especially if they are considering buying top-ups.
On the check your state pension forecast page, there is a tool on the right-hand side to explore if top-ups are worth it based on your record. You can also check your NI record here. But many who simply look up their current forecast might be unaware of what to do.
Savers buying state pension top-ups have reported long wait times ahead of the next deadline, especially if they are over state pension age or have worked abroad for periods when they want to fill gaps, which means they can’t use the online purchase tool.
One reader who bought them a couple of weeks ago rang HMRC and was told there was an eight-week backlog to allocate her money, but she would be prioritised because she is already drawing her state pension.
The Department for Work and Pensions and HMRC, which run the system between them, say state pension top-up applications are processed in date order and as long as you get your payment in by 5 April you will benefit from the special deal.
In spring 2023, the time-limited deal proved so popular that savers jammed phone lines and overwhelmed the system.
The meltdown ultimately forced the Government to extend the cut-off date twice, first to midsummer and then when demand didn’t slow until April 2025.
That caused a huge backlog of payments to process, and This is Money readers contacted us in droves over the following year to complain about long delays, lost cash and government staff giving wrong information or unable to help.
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