Pressure is growing on the government to rethink its refusal to pay Waspi (Women Against State Pension Inequality) pension compensation.
The shock announcement by Labour just before Christmas means 3.6 million women born in the 1950s will not receive a payout.
The UK government's move goes against a parliamentary ombudsman's recommendation of compensation, which suggested a payment of between £1,000 and £2,950 to those affected by the government's failure to properly communicate the state pension age rise.
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Official figures, meanwhile, released on January 21 show the number of women in Scotland impacted by the UK Government's refusal to offer compensation over long-planned changes to the state pension is more than 330,000.
The Scottish Government will call for Waspi women to be compensated during a debate on the issue at Holyrood today, on Tuesday, 21 January.
Shirley-Anne Somerville, Cabinet Secretary for Social Justice, will ask MSPs to back a motion calling for the UK Government "to compensate Women Against State Pension Inequality (Waspi) women as recommended by the Parliamentary and Health Service Ombudsman".
Despite the ombudsman's ruling, last month, Labour claimed there was no evidence of "direct financial loss".
Speaking in the Commons in December, prime minister Keir Starmer argued: "90% of those impacted did know about the change - and in those circumstances, the taxpayer simply can't afford the burden of tens of billions of pounds of compensation."
Waspi women and some MPs, including Labour backbenchers, have reacted angrily to the news, with many calling for a U-turn, or a Commons vote on the issue.
Chair of WASPI Angela Madden said in a statement: “This is a bizarre and totally unjustified move which will leave everyone asking what the point of an ombudsman is if ministers can simply ignore their decisions.
“An overwhelming majority of MPs back WASPI’s calls for fair compensation and all options remain on the table. If the Government cannot act to put things right, Parliament must now seek an alternative mechanism to force this issue to the order paper so justice can be done”.
First Minister John Swinney said the UK government's decision to deny compensation to women affected by changes to the state pension age was a "serious embarrassment" for Scottish Labour.
Why is Labour refusing to pay Waspi compensation?
The government apologised for a delay in sending letters notifying women of an increase to their state pension age, but has rejected any kind of financial payout.
Speaking in the Commons in December, the Department for Work and Pensions (DWP) secretary of state Liz Kendall said: “We cannot accept that in the great majority of cases, sending a letter earlier would have affected whether women knew their state pension age was rising.
“The government does not believe paying a flat rate to all women at a cost of up to £10.5 billion would be a fair or proportionate use of taxpayers’ money. Not least when the previous government failed to set aside a single penny for any compensation scheme and when they left us a £22 billion black hole in the public finances.”
Starmer and chancellor Rachel Reeves both defended the decision. Reeves said: "I understand that women affected by the changes to the state pension age feel disappointed by this decision, but we looked in full at the ombudsman recommendations and they said that around 90% of women did know that these changes were coming.
"And as chancellor, I have to account for every penny of taxpayers' money spent."
The surprise announcement followed weeks of comments from ministers saying that a Waspi update was imminent, raising hopes that a compensation package could be announced very soon.
A petition set up by the Waspi campaign group that called on the government to “announce a holding statement prior to Christmas and set out compensation proposals by 21 March 2025” had attracted more than 135,000 signatures.
Madden said: "The government has made an unprecedented political choice to ignore the clear recommendations of an independent watchdog.
"It will leave everyone asking what the point of an ombudsman is if ministers can simply ignore their decisions."
Kendall said that the government did take responsibility for maladministration in the early 2000s, which saw letters to women affected delayed by 28 months.
She added that the government will work with the ombudsman to create an “action plan” to prevent similar cases in the future.
The announcement follows almost a decade of campaigning by the Waspi group, which highlights the plight of women born in the 1950s who suffered a financial loss as a result of changes to the state pension age being poorly communicated and made with little notice.
In March last year, the Parliamentary and Health Service Ombudsman found the DWP guilty of “maladministration” over how it had communicated these changes.
The ombudsman called on parliament to secure funding for up to £10.5 billion to allow compensation to be paid.
Baroness Ros Altmann, a former pensions minister, warned that the women would likely be disappointed by any potential compensation, given the way the government has treated pensioners over changes to the Winter Fuel Payment.
What has the government previously said about Waspi?
Following the ombudsman’s ruling, MPs pressured the then-Conservative government to make an announcement about compensation before the summer recess, but this did not happen.
Steve Webb, the former pensions minister, then warned that the general election would inevitably delay any decision about redress for Waspi women.
There was no mention of Waspi in Labour’s manifesto, and there was little said after Labour’s election victory.
However, ministers recently started speaking on the issue. Pensions minister Emma Reynolds said: "The ombudsman took six years to look at what are a range of complex cases, and we are looking at the complexity of those cases."
She then later said: "I was the first minister for eight years to meet with the Waspi campaigners to listen to their concerns. We are working at pace on this issue. We hope to come to the house soon to update [...] the public on what we're going to do next."
Critics of the decision not to pay Waspi compensation have pointed out that Labour ministers were supportive of the campaign in opposition.
According to the Waspi campaign group, Kendall and Starmer have both previously spoken of the "injustice" that the women faced.
In 2019, Angela Rayner - now the deputy prime minister - told the BBC: "The government failed the women who were born in the 1950s. They stole their pension."
Why the ombudsman recommended compensation
The ombudsman found the DWP guilty of "maladministration" in how the changing pension age was communicated, and suggested that compensation of between £1,000 and £2,950 could be suitable for each person impacted.
Its report found that affected women should have received at least 28 months' more notice of the rise in the state pension age. Many women say they had insufficient time to make financial preparations and adjust their retirement plans.
What next for the Waspi campaign?
It's clear there are plenty of vocal critics of Labour's decision.
Madden and the rest of the Waspi campaign group will be considering their next steps, while MPs are likely to continue to lobby within parliament.
The chair of Waspi tells MoneyWeek: “We are not giving up. The parliamentary ombudsman has asked parliament to step in, and a cross-party group of MPs is taking action to demand a vote on the principle of compensation.
“Keir Starmer has not heard the last of this issue."
Labour backbencher Brian Leishman, said he was “appalled” at the government's decision, telling the Commons: “This is an incredible let-down. Waspi women, in my opinion, certainly do not need words of disappointment and they certainly do not need hollow statements. What they need is justice.”
Steve Darling, Liberal Democrat MP for Torbay, also criticised the lack of compensation, saying it was “nothing more than a betrayal of Waspi women”.
He commented: “Throughout the United Kingdom, there will be millions of women who are shocked and horrified by this decision by the government. The fact that they have inherited an awful state of our economy is no excuse.”
Charities may also pressure the government. Caroline Abrahams, charity director at Age UK, said it wasn't "credible for the government to contradict the ombudsman's painstaking report when it comes to liability for compensation".
She added: "Everyone understands that the public finances are under acute pressure but the government should not rub salt in the wounds of those impacted by suggesting there is no case for compensation. The fact that many of the women affected will also be coping with the loss of their Winter Fuel Payment this year will intensify their sense of injustice."
For now, there is no sign of a U-turn, with Downing Street saying there are "no plans" for a vote on whether women affected by changes to the state pension age should be compensated.
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