Millions ignore IR blunder response

ONLY A tiny proportion of millions of victims of an Inland Revenue pension blunder have made up the shortfall in their state retirement plans.

The Treasury has so far contacted 4.3m people to warn them that they need to top up their pensions by hundreds of pounds because of the six-year administrative failure. But just 64,687 have made payments.

Paymaster General Dawn Primarolo said the low level of contributions was 'not surprising'. She added: 'Most people should be able to earn entitlement to a state pension during a full working life without needing to pay additional contributions.'

Primarolo is to be questioned by MPs on the Treasury subcommittee on June 30. In a letter to committee chairman Michael Fallon, she revealed that only £12.7m in extra contributions had been received.

In total, 10m people - a quarter of the working-age population - have been affected by the blunder, which came to light last year. For the years 1996 to 2002, the Revenue failed to send reminders to those who should have topped up their state pension contributions.

As a result, victims have shortfalls in their pensions averaging £425, though in the worst cases the figure is £1,500.

The Treasury contacted and explained the problem to 4.3m people between November and May. It expects to have made contact with all those affected by September.