State pension 'mess' unresolved as National Insurance error scheme delayed: 'Frustrating!'

Patrick O'Donnell
Sat, 04 Apr 2026 11:29:47 +0000

A state pension "mess" remains unsolved as a scheme to rectify a historic National Insurance error has been delayed in a blow to thousands of Britons.

The Government has announced a twelve-month postponement to a scheme intended to safeguard the state pension records of mothers impacted by the High Income Child Benefit Charge, which was introduced in 2013.

The replacement credits system had been scheduled to take effect from the 2026/27 financial year but will now be pushed back by a full year.

LCP partner Steve Webb has criticised the decision, describing it as "deeply frustrating" and characterising the entire situation as "a mess from the start".

The delay comes just weeks before the programme was originally set to begin operating.

When the High Income Child Benefit Charge came into effect in 2013, parents with a higher-earning partner faced a tax liability that effectively cancelled out any Child Benefit payments they received.

Faced with this situation, hundreds of thousands of parents opted not to claim the benefit at all.

By choosing not to claim Child Benefit, these parents also forfeited National Insurance credits available to those caring for children under the age of twelve.

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These credits serve a crucial function in building up state pension entitlements for individuals who remain at home to raise their families.

Parents who later realised their mistake could submit a Child Benefit claim requesting only the National Insurance credits rather than the cash payment itself.

Yet this approach offered limited relief, as such claims could only be backdated for a period of three months. Consequently, affected individuals could still find themselves with multiple years absent from their National Insurance record.

The replacement credits scheme was devised specifically to address these gaps. Under the proposed system, parents who had missed out on credits due to the High Income Child Benefit Charge would be able to receive substitute credits to fill the missing years on their record.

Steve Webb, partner at LCP, condemned the postponement in stark terms: "It is deeply frustrating to see a delay in a scheme designed to unpick a mess in the pension system.

"When the High Income Child Benefit Charge was introduced in 2013, some parents – mostly mothers – decided it wasn’t worth bothering to claim Child Benefit, only for them or a partner to get a tax bill for the same amount.

"But by not claiming Child Benefit, they also threw away valuable National Insurance credits towards the state pension.

"The Government promised several years ago to fix this problem by creating ‘replacement credits’, but now we hear – just a few weeks before the new system was about to be introduced – that it has been delayed by a year. The whole thing has been a mess from the start."