DWP 'fixes' pension blunders penalising two low income savers - but then they happen again

By TANYA JEFFERIES, PENSIONS AND INVESTMENT EDITOR Updated: 09:12, 11 August 2026 Frontline government staff reverted to making the same pension blunders penalising low income savers in two cases supposedly fixed following the intervention of This is Money. We have revealed many people are unfairly denied hundreds or thousands of pounds because their pension contributions are not taken into account when Universal Credit (UC) is calculated. Payments into private and work pensions are meant to be deducted before their UC is worked out, to encourage people to save for their retirement. This is done automatically when people are enrolled in work schemes, but This is Money and our pensions expert Steve Webb have heard reports from all over the country that local Department for Work and Pensions staff are refusing to accept evidence of private contributions. Richard Spooner, pictured, contacted us because he was losing out on £110 a month in Universal Credit and his efforts to raise this were first rejected and then ignored by government staff. Richard Spooner: The GP surgery administrator says UC errors began again after This is Money got them corrected When his case was highlighted in a column by This is Money's pension expert Steve Webb last year, the DWP admitted its error and said the issue was 'resolved'. 'We have improved guidance for staff to accurately assess Universal Credit entitlement to help prevent this issue happening again,' it told Webb at the time. Spooner says DWP staff temporarily paid him correctly, but the 48-year-old, who lives in Cambridgeshire and works as an administrator at a GP's surgery, adds: 'Unfortunately once the case was closed they promptly stopped doing that and have ignored my 30 or so messages.' 'It seems as soon as This is Money were no longer involved they then reverted back to their bad ways.' Staff are meant to provide an upload link on request so that people can provide evidence of private pension payments each month. At the end of last year, Spooner says that at first he received these links, but the pension statements he sent in response were not acted upon, and then to his frustration staff stopped giving the links or answering him at all. In separate circumstances, This is Money covered the case of a hotel housekeeper aged 65 from Birmingham, who has dyslexia and is suffering from poor health. She made several requests to her JobCentre Plus to take her pension contributions into account when calculating her Universal Credit, but these were repeatedly refused and then her work coach blocked her from uploading proof of her pension contributions. After we first alerted the DWP to this case along with several others, it said: 'We have apologised and corrected their payments. There is no evidence to suggest a wider issue, but we are reviewing the available information and have reissued guidance to staff.' However, although she had only just been paid arrears for the error following the intervention of DWP bosses in London, local staff made the same mistake with her payment the following month. When we raised both these cases with the DWP for a second time, it paid Spooner £660 in arrears and our other reader £132, and told us additional guidance had been given to staff. Steve Webb, a former Pensions Minister who is now a partner at LCP, says: 'We keep seeing the same pattern repeating itself. 'People on Universal Credit who are doing what the government wants and making provision for their retirement being told wrongly that their pension contributions are not deductible. 'But it is even more shocking when cases we have brought to the Department’s attention and been resolved start to go wrong again in a matter of months. 'We need a system which works without people having to be experts in benefit law and insisting on their rights. And we need DWP staff at all levels to be fully trained to apply the rules correctly and consistently.' Webb adds that the number of cases we have seen suggests that this is a larger problem than the DWP realises, and it is vital that they now do proper checks to see if many more people are missing out on what is rightfully theirs. A DWP spokesman says regarding our second intervention involving the same people: 'We have corrected these cases and contacted both customers directly to explain what happened. 'Private pension contributions of this kind affect a very small proportion of Universal Credit claimants, but we are continuing to look at how we can improve guidance for staff to prevent these errors. 'Anyone who believes their Universal Credit award does not correctly reflect their personal pension contributions should raise this through their journal.' Are you making private pension contributions and receiving UC? If you think your payments are wrong contact pensionquestions@thisismoney.co.uk. Affiliate links: If you take out a product This is Money may earn a commission. These deals are chosen by our editorial team, as we think they are worth highlighting. This does not affect our editorial independence.