Interactive Investor

Did you pay ‘married woman’s stamp’? Newly retired urged to check to avoid missing out on pension top-up

9th October 2019 17:28

Stephen Little from interactive investor


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Women have been urged by former pensions minister Steve Webb to check their state pension income to see if they are entitled to an increase worth thousands of pounds.

Some retired women could be missing out on thousands of pounds a year because of a little-publicised concession under the new state pension system.

Newly retired women who paid the married woman’s stamp towards their pension early in their careers could still benefit from it now, according to a former pensions minister.

Steve Webb, director of policy at Royal London and a former pensions minister, is urging women to check their state pension income to see if they benefit from this little-known feature designed to protect those who paid a reduced rate of National Insurance Contributions (NICs).

- Court rules against women over state pension age changes

How much could you get?

The concession could be worth between £4,027 and £6,718 a year depending on your circumstances.

Before the introduction of the new state pension system in April 2016, women could claim a partial state pension based on the NI record of their husband. 

However, the new state pension system is based on an individual’s own NICs, not those of their husband, which could leave some women disadvantaged.

Recognising this problem, the government introduced a concession that allows women reaching state pension under the new rules and who paid the married woman’s stamp to make a claim based on their husband’s NI record. 

The rate payable would be a full basic state pension of £129.20 if they are now divorced or widowed, or 60% of the basic state pension - £77.45 per week - if they are married.

The government estimates that around 10,000 women could potentially benefit from this concession.

Mr Webb says: “It is amazing that in designing a state pension system in the 21st century, the government had to include special rules to protect women affected by a rule designed in the 1940s. 

It is not widely known that women who paid the reduced stamp at any point in the 35 years before they retired, and who come under the new state pension system, can claim a minimum payment under the new system. 

“If any woman is getting a substantially reduced amount from the new state pension, she should check if she paid the reduced stamp and contact the Pension Service if she is in any doubt.”

- Pensioners on course for state pension increase well ahead of inflation

What is the married woman’s stamp?

Until 1977, married women who went to work could opt to pay a reduced rate of NICs - known as the married woman’s stamp”.

These women would not build up a state pension in their own right but would be entitled to claim a partial state pension based on the NI record of their husband when he retired.

The number of women paying the reduced stamp peaked in the 1970s at around 4.4 million. 

From 1978 onwards, no new married women were allowed to opt to pay a reduced rate of contributions as the idea that a man was the main breadwinner had become outdated.

Those who were already paying the reduced rate were allowed to continue to do so and this entitlement has continued to this day and lapses only if a woman does not pay contributions for a period of two full years.

A Freedom of Information Request from Royal London shows that around 200 women are still paying reduced NICs.

What should you do to claim?

The full basic state pension for women is £129.20 if you are divorced or widowed, or £77.45 per week if you are married.

Royal London is calling on women receiving less than these amounts to check if they paid the married woman’s stamp at any point in the 35 years up to retirement.

If they did, they should contact the Pension Service to see if they are entitled to a higher pension.

- This article was first written by our sister magazine Moneywise.

This article was originally published in our sister magazine Money Observer, which ceased publication in August 2020.

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