The Women Against State Pension Inequality (WASPI) campaign has scored a major victory in its fight to win compensation for 1950s-born women affected by short notice changes to their State Pension age.

The group launched a judicial review in the High Court earlier this year – raising £120,000 from thousands of affected women – to challenge a Parliamentary and Health Service Ombudsman (PHSO) report that claimed “[t]here is too much we cannot now know about what would have happened if DWP had written to women about the 1995 Pensions Act sooner”, and that none of a group of ‘sample complainants’ had suffered injustice in the form of financial losses, or loss of opportunities, because of DWP maladministration.

In the first stage of its investigation into the Department for Work and Pensions’ communication of state pension age changes, the Ombudsman concluded that DWP had committed maladministration by failing to write promptly to the affected women.

His July 2021 report found that 1950s-born women should have had “at least” 28 months’ more individual notice of the changes. “For women who were not aware of the changes, the opportunity that additional notice would have given them to adjust their retirement plans was lost,” he concluded.

But he then changed tack dramatically. In a so far unpublished second stage report, he went on to make what he now concedes was a ‘legally flawed’ calculation about the impact that maladministration had.

The PHSO had decided to assess the injustice suffered by WASPI women on the premise that each woman affected would have received a letter notifying them of changes to their state retirement ages exactly 28 months earlier than they did.

In the case of the many women who never received a letter, he calculated the 28 months by reference to the dates women in similar circumstances received such letters.

WASPI challenged this approach in court, arguing that counting 28 months backwards from the dates on which women received letters was ‘irrational’ as it failed to take account of three periods during which the DWP had paused its already belated direct mail campaign.

The flawed calculation could make a massive difference to the losses women suffered because of the DWP’s maladministration. For example, it meant that in the case of one sample complainant, Mrs W, the PHSO assumed she would still have received her letter as late as March 2011 even if DWP had communicated State Pension age changes properly.

By contrast, lawyers acting for the affected women successfully argued that if DWP had started its direct mail programme when it should have – and sent the letters out without ‘pauses’ – Mrs W could have received notice of the delay to her State Pension at least two years earlier, in June 2009.

Had Mrs W received her letter when she should have, WASPI argues that she – and millions of other women in a similar position – would have taken different ‘life-changing’ decisions about their work and retirement plans. In Mrs W’s case, she gave up a job in November 2010 – something she would not have done had she known her State Pension would not be paid out until she was at least 65 years old.

In an unprecedented move, the PHSO has now accepted its approach to calculating injustice ”failed sufficiently to consider the potential effect of the pause periods and was legally flawed for that reason.” It is the first time the PHSO has settled a judicial review claim at such an early stage of legal proceedings.

The PHSO also accepted there had been no proper consideration of his own guidance on compensation for loss of opportunities.

An order submitted to the High Court for approval will now see crucial parts of the Ombudsman’s Stage 2 report quashed and reconsidered. His draft Stage 3 report – which describes the level of compensation women should get – will also be rewritten.

Commenting, WASPI Chair Angela Madden said: “This is a real milestone on our very long journey to justice. The PHSO’s Stage 2 conclusions were clearly irrational, and had to be challenged. We are delighted that he has conceded on all the material points in our legal argument and will now reconsider his findings.

“Such a big victory would not have been possible without the support of thousands of ordinary women who dug deep to fund our case. The PHSO could see that we would not just accept flawed conclusions and quietly go away.

“Now we call on all political parties to commit to fast, fair compensation for WASPI women in their manifestos at the next election. With one of our number dying every 13 minutes, there’s not a second to waste in recognising the financial loss, hardship and trauma DWP’s incompetence has caused.”

WASPI’s solicitor, Caroline Robinson of Bindmans LLP, said: “A huge group of women who had been let down badly by the DWP placed their trust in the Ombudsman to get to the bottom of why that happened, why it was unjust and to recommend a fair remedy.

"Regrettably, the Ombudsman also let them down with his deeply flawed Stage 2 report. But our clients are pleased that the Ombudsman had the humility to recognise his errors when challenged and agreed to withdraw the report and reconsider his approach.

"Our clients are hopeful that this will lead to a fairer outcome for those affected by the DWP’s maladministration.”