The Department for Work and Pensions (DWP) has issued a fresh warning over state pension and benefit delays, highlighting that it is the claimant's responsibility to decide when to claim their pension. Pensions Minister Torsten Bell told Parliament that the department does not know if a person has deferred their state pension until they submit a claim, making it impossible to track how many people have chosen to delay payments.
In a written response to Labour MP Andrew Lewin, Bell explained that deferring the state pension is a personal choice based on individual circumstances. Factors include length of deferral, employment, dependents, tax position, and entitlement to other benefits. The minister stressed that the DWP encourages people to seek independent financial advice before making a decision.
According to figures obtained by Royal London through a Freedom of Information request, nearly 42,000 people deferred their state pension in the 2023/2024 tax year. The consumer group Which? reported that one in four of those had postponed their pension by five years or more, while 4,400 deferred it by over a decade.
Deferring the state pension can increase its value over time, either as a one-off lump sum or higher regular payments. However, claimants must defer for at least nine weeks to qualify for the increase. Experts warn that individuals need to consider whether they will live long enough to 'break even' on the deferred amount, as there is no time limit for claiming.
Bell added that deferring can affect other benefits, current financial position, and future tax liabilities. The DWP sends an invitation to claim up to four months before a person reaches state pension age, which includes signposting to deferral information on the government website. The minister reiterated that the decision rests solely with the claimant.
