Waspi ladies will obtain NO compensation, says Labour, as Steve Webb warns of ‘worrying precedent’

Waspi women born in the 1950s will receive no compensation from the Labour Government.

The Department of Work and Pensions has rejected the Parliamentary Ombudsman’s recommendation of payments of £1,000 to £2,950 to those affected.

The Ombudsman, which said this would cost £3.5 to £10.5billion if paid to all women born in the 1950s, found in a report earlier this year that the Government failed to adequately inform women that their state pension age was delayed.

Many women born in the 1950s have faced hardship while they wait longer than they expected to draw the state pension – the age is now 66 for both women and men.

The Women Against State Pension Inequality or Waspi campaign argued there were major failings in the way the rise in state pension age was communicated.

Two hikes were also speeded up and timed to happen in quick succession in 2018 and 2020, giving them little notice to fill the hole in their retirement finances.

Waspi campaign argued there were major failings in the way the rise in women’s state pension age was communicated

Angela Madden, chair of the Waspi campaign, says: ‘The Government has today made an unprecedented political choice to ignore the clear recommendations of an independent watchdog which ordered ministers urgently to compensate Waspi women nine months ago.

‘This is a bizarre and totally unjustified move which will leave everyone asking what the point of an Ombudsman is if ministers can simply ignore their decisions. 

‘It feels like a decision that would make the likes of Boris Johnson and Donald Trump blush.

‘The idea that an “action plan” to avoid such mistakes in future should be the result of a six-year Ombudsman’s investigation is an insult both to the women and to the PHSO process.

‘An overwhelming majority of MPs back Waspi’s calls for fair compensation and all options remain on the table. Parliament must now seek an alternative mechanism to force this issue on to the order paper so justice can be done.’

Liberal Democrat Work and Pensions spokesperson, Steve Darling MP, says: ‘Today is a day of shame for the government.

‘The new government has turned its back on millions of pension-age women who were wronged through no fault of their own, ignoring the independent Ombudsman’s recommendations, and that is frankly disgraceful.

‘The Conservative party left our economy in a shambles, but asking wronged pensioners to pay the price of their mismanagement is simply wrong.

‘For years, Liberal Democrats have pushed the government to fairly compensate Waspi women in line with the Ombudsman’s recommendations. Today’s heartless decision cannot be allowed to stand and we will be pressing ministers to give those affected the fair treatment they deserve.’

Steve Webb’s verdict: A worrying precedent 

Steve Webb, former Pensions Minister and now a partner at LCP, says: ‘The Government’s handling of this issue sets an extremely worrying precedent.

‘If it is acceptable for a department to completely reject the findings of a report by the independent Parliamentary Ombudsman, this strikes a blow at the heart of the whole process.

‘There is a risk that governments will now feel emboldened to “pick and choose” when faced with a critical Ombudsman report, effectively setting themselves up as judge and jury.’

Webb, who is This is Money’s retirement columnist, adds: ‘Even if the government felt it could not afford to implement the recommendations in full, there were many options which would have offered some redress to those most affected.

‘Outright rejection of the Ombudsman’s report raises much wider issues than compensation over pension age changes, and MPs should not take this decision lying down.’

Why is there controversy over women’s state pension age rises? 

Plans to equalise men and women’s state pension age were first outlined in 1995.

The then Conservative Government stated the intention of gradually raising women’s retirement age to 65 between 2010 and 2020.

This was followed in 2007 by a Labour announcement that both men and women would see their retirement age go up to 66 between 2024 and and 2026.

But in 2011, Chancellor George Osborne brought forward the timing of both changes to 2018 and 2020 respectively, hitting women particularly hard because their increases happened both sooner than expected and in quick succession.

Initially, the overhaul included a cap of a maximum two years’ extra wait for a state pension, but protests led to the cap being reduced to 18 months.

Some 2.6million women got five years’ notice of a delay to their pension age.

The Women Against State Pension Inequality or Waspi campaign has fought for measures to cushion the financial blow, and urged women to complain first to the DWP itself and then to the Parliamentary and Health Service Ombudsman.

A separate group, BackTo60, brought a legal challenge but this was dismissed by the Court of Appeal in September 2020.

Waspi said the courts could not make a judgement on maladministration because that was the role of the Ombudsman. 

The end of the court case freed the Parliamentary Ombudsman to look at women’s complaints, and its report in 2021 accused the Government of ‘maladministration’ over delays to informing women about the changes.

In a second report in March this year, it told the Government to compensate women for failing to adequately inform them their state pension age was delayed.