Thousands of pensioners across the UK may have been short-changed by the government in a state pension blunder worth more than £800 million. The Department for Work and Pensions (DWP) has been carrying out a major correction exercise since January 2021 after identifying historic underpayments affecting mainly women.

According to the latest official figures published by the DWP, a total of 130,948 underpayments were discovered by March 31, 2025 - with arrears totalling £804.7 million. The issue has affected married women whose pensions were not correctly increased when their husbands retired, widows who were not reassessed after their spouse died, and over-80s whose pensions were never uplifted as required.

According to PensionAge, £252.8 million has been paid to 47,004 married women, £483.4 million to 50,261 widowed cases, and £68.5 million to 33,683 pensioners over 80 - with average payouts ranging from £2,200 to over £11,700.

In a separate review, another £42 million has been uncovered in underpayments linked to missing records of Home Responsibilities Protection (HRP), which affects parents - mainly mothers - who claimed child benefit before 2000.

As reported by the Northern Echo, this figure is expected to rise as the correction exercise continues through 2025.

Sir Steve Webb, a former pensions minister who has long highlighted pension errors, said the situation was “truly shocking,” adding: “The vast majority of those who lost were women, some of whom were underpaid for decades or even went to their grave never paid the right state pension.”

He also told PensionAge it was now “highly likely” the final bill would exceed £1 billion once all errors - including HRP corrections - are addressed.

Rachel Vahey, the Head of Public Policy at AJ Bell, said: “This is one of the biggest benefit scandals of modern times.

“DWP miscalculations have left thousands of pensioners - mainly women - short on their state pension payments.

“It is absolutely critical all those affected by this scandal receive the money they are owed as quickly and efficiently as possible.”

A DWP spokesperson said: “Our priority is ensuring pensioners receive the dignity and security they deserve in retirement and that state pension underpayment rates remain as low as possible.

“We have now completed the vast majority of cases in the exercise as planned with a small number of outstanding cases due to further documentation needed from the customer.”

Pensioners who think they may be affected can contact the Pension Service for further guidance. More information is also available on the government website at gov.uk.