Source · Select Committees · Public Accounts Committee
Recommendation 18
18
Accepted
Identifying and compensating eligible next-of-kin for HRP underpayments poses significant challenges.
Conclusion
We asked HMRC how it can be sure that it will reach the right people and also avoid paying out any illegitimate claims. It told us that it would apply due diligence to all claims. HMRC also told us that alongside targeted letters it is planning a communication campaign to encourage people who think they may have missed out to apply. HMRC added that in August 2023 it launched an online checker that customers can use to understand if they have enough National Insurance contributions for a full State Pension – where this is already full, HRP would not make any difference.37 We challenged DWP to justify its assumption, set out in the 2022–23 accounts, that 75% of the next-of-kin of deceased customers will come forward to make a claim for HRP. DWP explained that this is the based on the take-up rates it observes for the ongoing State Pension underpayment exercise. It told us it has set up a next-of-kin portal that people can register with if they think a deceased relative may have been underpaid.38 However, HMRC acknowledged that it is “incredibly difficult” to find and pay back the right next-of-kin. HMRC added that where there are competing claims from multiple next-of-kin it will have to make a judgement, but it has not yet decided how to handle this.39
Government Response Summary
The government agrees with the committee's implied concern and commits to working with HMRC by Winter 2024 to set out an approach for assuring the integrity of the National Insurance record, including engaging with a joint Internal Audit review.
Government Response
Accepted
HM Government
Accepted
The government agrees with the Committee’s recommendation. Target implementation date: Winter 2024 The department and HMRC have agreed to work together on this, building on a strong existing relationship and established Director led Cross-Departmental Oversight for National Insurance Group. The department and HMRC will set out the approach to assuring the integrity of the National Insurance record in relation to State Pension, in the first instance. This includes engaging with the joint Internal Audit review being undertaken by the Government Internal Audit Agency (GIAA) and HMRC’s Internal Audit team to help us ensure our control framework is effective.