The pension perk tens of thousands are missing out on: National Insurance Credits

Mar 22, 2018


By Kate Brown

National Insurance Credits - Knowles Warwick

National Insurance Credits are the pension perk that tens of thousands are missing out on. Introduced in April of 2011, grandparents can receive up to £230 a year in retirement for looking after their relatives’ children, whilst parents or main carers can claim National Insurance Credits under a separate scheme. This could total to more than £4,500 over a typical 20-year retirement. National Insurance credits can help grandparents build up a full state pension. Under the new state pension, for those at state pension age after April 2016, you need 35 years to qualify for the full amount of £155.95 a week.

However, as many as 90% of those eligible (approximately 90,000 grandparents) missed out on the pension perk in 2017 with just 9,468 applications for the credit being made. Although, this was a significant increase from the previous year which saw only 1,300 people claiming the credits. Former pension’s minister and Royal London’s policy director, Steve Webb, commented: “this National Insurance credit is a valuable right, and it is good news that the numbers claiming have risen so dramatically in such a short space of time”.

Many grandparents help out with childcare in order to allow for the parents or main caregivers to work. Statistics show that 1 in 4 working families and 1 in 3 working mothers used grandparents for childcare, 63% of all grandparents with grandchildren under the age of 16 help out with childcare, and 1 in 5 grandmothers provide at least 10 hours of childcare per week. Steve Webb said: “it is right and proper that when grandparents sacrifice their own working to help a family member get back to work, they should not also damage their own state pension prospects”.

People have been advised by the Department for Works and Pensions (DWP) to find out more about their pension and what they are entitled to for looking after grandchildren. Steve Webb, said: “we believe that there are tens of thousands more grandparents who could be entitled to benefit, and we would encourage them to find out more about the scheme and to make a claim”.


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