Hundreds of thousands given wrong pension forecasts
Around 3% of the government's 12 million state pension forecasts since 2016 have been incorrect.
7th June 2019 11:28
by Tom Bailey from interactive investor
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Around 3% of the government's 12 million state pension forecasts since 2016 have been incorrect.
The government's pensions minster has been forced to admit that hundreds of thousands received wrong state pension forecast figures.
In a letter to Royal London's policy director Steve Webb, pension minister Guy Opperman admitted that there had been "significant" problems with incorrect state pension forecasts.
It was noted that problems with HMRC data meant that around 3% of the government's 12 million state pension forecasts since 2016 had been incorrect.
The government's faulty forecasts were communicated to 350,000 pensioners who, as a result, may have been planning their retirement using wrong figures.
The issue first came to light following several reports in the press from members of the public claiming to have received incorrect or inconsistent forecasts. Some of the forecasts were £1,500 higher than members of the public had previously expected, causing confusion for those attempting work out what they would have to live on in retirement.
When Webb first flagged the issue, the DWP claimed that the faulty forecasts were isolated errors.
According to Opperman, accuracy rates are improving; the minister says that more work will now be done to try to improve accuracy.
Commenting on the findings, Webb said: "It is therefore very worrying that hundreds of thousands of people may have received incorrect state pension forecasts and in some cases will have taken decisions about their retirement plans on the basis of incorrect information.
"Now that the government is aware of the scale of the problem, it must put an urgent stop to the issuing of incorrect statements. Individuals need to have confidence that the information they receive from the government is accurate and should not have to live with the uncertainty."
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This article was originally published in our sister magazine Money Observer, which ceased publication in August 2020.
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Full performance can be found on the company or index summary page on the interactive investor website. Simply click on the company's or index name highlighted in the article.
These articles are provided for information purposes only. Occasionally, an opinion about whether to buy or sell a specific investment may be provided by third parties. The content is not intended to be a personal recommendation to buy or sell any financial instrument or product, or to adopt any investment strategy as it is not provided based on an assessment of your investing knowledge and experience, your financial situation or your investment objectives. The value of your investments, and the income derived from them, may go down as well as up. You may not get back all the money that you invest. The investments referred to in this article may not be suitable for all investors, and if in doubt, an investor should seek advice from a qualified investment adviser.
Full performance can be found on the company or index summary page on the interactive investor website. Simply click on the company's or index name highlighted in the article.