Former Pensions Minister Steve Webb has called on recently retired women who paid the so-called ‘married woman’s stamp’ in their early career to check their state pension income and ensure they are getting their full entitlement, which could be worth nearly £7,000 a year.
The affected women would have been part of a National Insurance system designed in the 1940s, which assumed they would rely on their husbands in retirement. It allowed them to pay a reduced rate of National Insurance contributions (NICs), known as the ‘married woman’s stamp’, in return for a partial state pension based on their husband’s NICs.
However, the new state pension system ended this scheme for any women who retired after 6 April 2016. Therefore, the Government introduced a concession for these women, entitling them to either £4,027 and £6,718 a year, depending on their circumstances, in the state pension.
The number of women who paid a reduced stamp rate peaked in the 1970s to around 4.4 million before the scheme closed to new entrants in 1979, and while only around 200 people are still paying National Insurance at the reduced rate, researchers estimate that up to 10,000 women could be entitled to extra money if they paid the lower threshold at some point.
According to the Department for Work and Pensions (DWP), the Government issues these payments automatically, but Sir Steve claims that thousands of women could miss out if they do not check their entitlement.
Steve Horton, Financial Planning Partner at Milsted Langdon, said: “It is important that all women check to see if they will be affected by the ‘married woman’s stamp’ otherwise they could be missing out on thousands of pounds.
“If you feel you may be affected by anything mentioned in this article, then it is important that you seek specialist advice. Contact us today to find out how we can help you.”