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Help for Heroes has welcomed the announcement by the Ministry of Defence and the Treasury that war widows and widowers who forfeited pension entitlements upon entering a new relationship will receive a compensatory one-off payment of £87,500.
Why did these widows/widowers lose pension entitlements?
Prior to 2015, the spouses or civil partners of service personnel, whose deaths were attributable to their service, were forced to surrender their late partner’s pension if they remarried or cohabited with a new partner. This rule applied regardless of the bereaved spouse’s or new partner’s income or circumstances.
There was a rule change to address this problem in 2015, which allowed spouses and partners who became widows and widowers after this time to keep their pensions on remarriage. However, for those whose partners died before 2015, pension entitlements were not restored, meaning they continued to lose out on this support going forward. There is an estimated 300 people in this position.
What is the lump-sum payment scheme?
In recognition of the sacrifice that these families have made, the Government will launch a two-year scheme to allow eligible spouses and partners to claim the lump-sum payment to compensate this loss of income. However, this will be subject to tax.
The Treasury has set aside £33 million to fund the scheme, which expected to be open later this year and be administered through Veterans UK.
This payment will not necessarily fully replace the loss of income that these spouses would have been entitled to over the decades. However, it will offer some financial stability that their partner’s pension would have given them.
As a member of the Armed Forces community, how can I get help with my finances?
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