- The system is currently managed by DWP and HMRC and involves calling both
- The online payment service was expected by the end of the financial year
- After repeated promises, news of postponement is ‘deeply disappointing’: Steve Webb
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Additions to the state pension: the online service has been postponed and there is no launch date yet
A new online service for topping up state pensions is being postponed, despite government pledges that it should be ready by the end of the financial year.
No start date has been given for the service, which allows people to check whether buying top-ups will increase their state pension and make payments.
The system currently involves calling both the Department for Work and Pensions and HMRC, who manage the system between themselves.
This is Money has received a flood of complaints about lengthy delays and the lack of additional state pension payments for more than a year.
The government now says the online service will be introduced as soon as possible after the usual update of the National Insurance Scheme at the start of the new tax year.
It has confirmed that this will not be until October, when people are allowed to apply for National Insurance credits, as this is when the previous year’s NI data has been loaded and finalized.
HMRC and the DWP say the launch will take place following the NI system update, ensuring customers have continuous access to the service without disruption to availability.
They add that this will allow the service to take into account the April state pension increase for 2024/2025, to ensure users see the most up-to-date information on how much additional state pension they could receive by paying to plug gaps in the to fill pension provision. their NI record.
We now need a definitive date for the service to go live so that people know when they will be spared the misery of staying on government phone lines.
However, for months they told us that the new service was ‘expected to be ready later this financial year’ and that the annual NI system update was known, so it seems something has gone wrong.
The news will be a blow to savers, some of whom are likely to delay buying top-ups until an online service is available, expecting the purchasing process to be simpler and more convenient.
Buying top-ups can provide a generous boost to retirement income if you buy the right years on your record – see below.
However, after the payment for additional contributions has been made, HMRC will still need to update the National Insurance data, after which the DWP will recalculate the state pension forecasts or payments.
It is unclear whether these phases will be streamlined, or whether there will be enough staff to ensure that the entire system does not ‘collapse’ under a new wave of additional purchases.
Frustrated savers have complained of chaos and long delays since early 2023, when the system was overwhelmed before a crucial deadline, eventually forcing the government to extend it twice, now until April 2025.
Former Pensions Secretary Steve Webb said: ‘Having repeatedly promised that this new service would go live by the end of the tax year, it is very disappointing that there is now a delay.
‘Currently, people still have to use two different government telephone lines to find out where they stand with regard to supplementing their state pension and then arrange payment.
Webb, This is Money’s pensions columnist and partner at LCP, added: ‘An online service could be a big improvement, provided HMRC and DWP staff are deployed to deal with the potential flood of top-ups.
‘We now need a definitive date for the service to go live so people know when they will be spared the misery of being stuck on government phone lines.’
The DWP and HMRC say the majority of people, including those living abroad who wish to make voluntary contributions during their years in Britain, should be able to benefit from the new online service once development and testing be completed.
A digital application procedure for top-ups for periods living or working abroad was launched at the end of January, meaning people no longer need to post a CF83 form.
A government spokesperson said: ‘A new online service will soon be launched to allow most people to see whether making voluntary contributions would increase their state pension and make payments. More information will be released in due course.
‘Over the past year, hundreds of thousands of people have contacted us about voluntary contributions, with the vast majority of payments resulting in data being updated within days.
‘Complex cases requiring specialist practitioners may take longer to resolve, but we are making good progress in reducing waiting times.’