WASPI latest as DWP boss to face compensation plan questions this week

The Secretary of State for Work and Pensions is set to face an accountability session with the Work and Pensions Committee this week.

The meeting, scheduled for Wednesday (May 22) at 9.25am, will scrutinise the work of Mel Stride's Department as well as recent UK Government announcements and policy developments. Peter Schofield, Permanent Secretary, will join the Department for Work and Pensions (DWP) chief in the session.

They are expected to answer questions about the UK Government's approach to welfare reform. This includes the latest plans to alter how eligibility is assessed for the health aspect of Universal Credit, the timetable for further migration from legacy benefit claimants, and the recently published 'Fraud and Error' report.

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The Committee may also raise issues they have recently contacted the DWP about. These include the Department's efforts to tackle Carer's Allowance overpayments and the UK Government's response to the Parliamentary and Health Service Ombudsman's (PHSO) report on changes to women's State Pension age.

It is likely that the discussion will involve questions about a compensation plan for an estimated 3.8 million women affected by State Pension age changes, reports the Daily Record. Sir Stephen Timms, chair of the Work and Pensions Committee, penned a letter to Mel Stride last week, following a May 7 oral evidence session with the Women Against State Pension Inequality (WASPI) Campaign and the PHSO on the findings in its final report into changes made to the State Pension age for women born in the 1950s.

The PHSO concluded a six-year investigation with a final report published on March 21, stating that the DWP failed to adequately communicate changes to women's State Pension age, and those affected are due compensation. The Ombudsman has called on Parliament to "act swiftly" to ensure a compensation scheme is put in place, based on these findings.

In his letter, the Labour MP implored the UK Government to "bring forward proposals for a remedy by the summer recess." Parliament is scheduled to break for the summer on July 23.

The letter states: "As you are aware, the PHSO laid its report before Parliament on March 21 2024, asking Parliament to 'identify an appropriate mechanism for providing remedy' for women born in the 1950s who have suffered injustice because of DWP's maladministration in its communication of increases in their State Pension Age (SPA) legislated for in the Pensions Act 1995."

"In a one-off evidence session on the issue on May 7, we were reminded of the need for urgent action, given that the ombudsman started to look at this issue in 2018 and that every 13 minutes a woman born in the 1950s dies."

The PHSO recommended compensation equivalent to Level 4 on its banding scale - between £1,000 and £2,950, however, the WASPI Campaign and some MPS, including the SNP's Alan Brown, are keen to see the highest level of compensation awarded (Level six) - which starts at £10,000.

But the East Ham MP said that the Committee has "not sought to question the PHSO's proposal for compensation at level 4, but instead have focused on what a remedy might look like".

Sir Stephen continued: "The evidence we received indicated support for a rules-based system. This would be a system where payments would be adjusted within a range (based on the PHSO's severity of injustice scale) to reflect the extent of change in the individual's state pension age and the notice of the change which the individual received."

"This would mean that the less notice you had of the change and the bigger the change in your SPA, the higher the payment you would receive."

"While not perfect, the advantages of such a system are that it would be: quick to administer; applying known data to a formula to determine the amount due; and relatively inexpensive."

The letter also urged some flexibility for people to make the case individually, after they have received the payment using the rules-based system, that they experienced direct financial loss and that they are due a higher level of compensation.

The letter highlighted evidence from Angela Madden, chairwoman of the WASPI Campaign. She previously told the Committee that women's divorce settlements had been based on a pension age of 60, meaning they had been awarded less money.

The letter added: "Implementing a remedy will need parliamentary time, financial resources, and the data and technical systems only available to your department."

"It cannot happen without Government support. We would ask you to bring forward proposals for a remedy by the summer recess."

Speaking about the letter, Sir Stephen said: "The debate over the impact of the DWP's failure to communicate increases in the women's state pension age has dragged on for too long and it is time the Government took action to resolve the issue."

"There is no perfect solution, but there would seem to be broad support for a rules-based system of compensation with a degree of flexibility for cases where women have experienced direct financial loss."

"While the ombudsman has put the matter in the hands of Parliament, a remedy can only happen with the support of the Government and we hope ministers will move quickly to bring forward its proposal before the summer."

Commenting on the Committee's actions, Ms Madden said: "Parliament's top pensions thinkers have spoken. It is now time for the Government to act and give the Commons as a whole its say."

"The Committee is right to suggest there must be additional compensation for those many hundreds of thousands who suffered direct financial loss in addition to a fixed sum for all those affected by successive governments' failures."

"After years of campaigning, both the independent ombudsman and now a cross-party group of senior MPs have vindicated our position."

"For ministers to leave setting up a compensation scheme a moment longer is just delaying the inevitable and insulting our generation of women afresh."

The WASPI Campaign estimates around 3.8 million women have been impacted by changes to their State Pension age.

A DWP spokesperson said: "We are considering the Ombudsman's report and will respond in due course, having cooperated fully throughout this investigation."

"The government has always been committed to supporting all pensioners in a sustainable way that gives them a dignified retirement whilst also being fair to them and taxpayers."

"The State Pension is the foundation of income in retirement and will remain so as we delivered a further 8.5 per cent rise last month, increasing the state pension for 12 million pensioners. This has seen the full rate of the new State Pension rise by £900."

You can read the letter in full on the Work and Pensions Committee website here. You can watch the Work and Pension Committee meeting from 9.25am on Wednesday, May 22 on Parliament TV here.