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Compensation for Waspi women who lost out when the pension age was changed must be “fair” to the taxpayer, Chancellor Jeremy Hunt has said, following warnings that it could cost up to £10.5bn.
He suggested it will “take time” to organise payouts for the millions of women affected and cautioned: “There’s no secret vault of money.”
Mr Hunt made is comments in the wake of a report last week that said the Waspi (Women Against State Pension Inequality) group should receive up to £3,000 each in compenstion.
“We want to resolve it as quickly as we can, but there’s no secret vault of money,” the Chancellor said.
“The money that we were paying compensation has to come from other taxpayers. So we do have to take time to get this fair.”
The Waspi groups say millions of women born during the 1950s lost out because they were not properly informed that their state pension would rise from 60 to 65, in line with men. The age was later increased to 66 for both sexes, and is due to rise to 67 between 2026-28.
Campaigners say the lack of information meant that some women gave up their jobs, and then suffered financial hardship because they did not have enough to live on in retirement.
Mr Hunt said the issue was complicated and decisions about it had to take many factors into account, as has happened with other cases such as the Post Office scandal and infected blood scandal.
He denied that the Government was leaving “huge unpaid bills” to the next parliament, adding on the BBC’s Sunday with Laura Kuenssberg programme: “With the Waspi women, it is genuinely more complicated.
“The reason is this: that we had the ombudsman’s report on Thursday, but we’ve also had a report from the High Court and Court of Appeal in 2020 that says the Department for Work and Pensions behaved completely within the law and didn’t discriminate.
“So it appears to say something different and we do need to get to the bottom of that apparent difference between the two.”
It comes after a damning report into failures at the Department of Work and Pensions (DWP) published by the Parliamentary and Health Service Ombudsman (PHSO).
The ombudsman told the Government it should offer up to £2,950 in compensation to women hit by major changes to the state pension age.
This, however, is far below the £10,000 the Waspi group wants for all 3.6 million surviving women who were affected after they had to wait another five or six years for their state pension.
The ombudsman said it could cost the Government between £3.5bn and £10.5bn to compensate all women born in the 1950s who were affected.
Rebecca Hilsenrath, chief executive of PHSO, said the ombudsman had concluded there were “failings by DWP” and had determined that “the women affected are owed compensation.”
She added: “DWP has clearly signaled its intention to reject compliance. This stance is unacceptable. The department must fulfill its obligations, and it must be held responsible for its failure to do so.
“Given our significant concerns regarding the department’s potential non-compliance with our findings and the urgent need to rectify the situation for the affected women, we have taken proactive steps to request Parliament’s intervention and ensure accountability for the department.”
She said that “Parliament must now act promptly to establish a compensation scheme” as this would be the “most expeditious means to provide redress to the affected women”.
