Money blog: 'Common error' could leave thousands of women out of pocket in their pensions during maternity leave - without realising (2025)

By Megan Harwood-Baynes, cost of living specialist

Thousands of British women could be missing significant sums from their pension due to a "common error" made by their employers while on maternity leave, the Money blog can exclusively reveal.

When a woman goes on mat leave, their employer should continue to make pension contributions based on their full salary. However, women have reported their contributions have been wrongly changed to match their lower mat leave income.

Women who spoke to Sky News reported missing anywhere from a few hundred to £4,000 in their pension pots.

Advocacy group Nugget Savings shared data with Money after surveying 236 women about their pension contributions while on maternity leave. More than 100 had found discrepancies, and while some have been repaid the money after raising it with their HR department, others have not.

It is not clear how widespread the issue is, but Katie Guild, co-founder of Nugget Savings, said: "We're concerned we have just scratched the surface of this issue. This error could have started as far back as auto-enrolment in 2012, therefore affecting potentially millions of women."

Some 'faced resistance' trying to get error fixed

More than half a million women take maternity leave each year and a pension mis-payment of just a few hundred pounds loses the chance to earn compound interest over the following decades, exacerbating the existing gender pension gap, which sees the average woman retire with a pension pot 55% smaller than the average man's.

Katie said: "Some were successful in recouping their lost pension contributions.

"Others faced resistance from their employers who said too much time had passed to fix the error or the employers still believed that they had contributed correctly to their pensions."

Problems are 'tip of the iceberg'

MP Stella Creasy expressed concern to Sky News about these discrepancies.

"The problems women have with pensions and their maternity leave are just the tip of the iceberg when it comes to why millions of older women end up destitute," she said.

"When employers write women off because they have children they don't just harm their careers, they consign them to poverty in old age too.

"With women living longer and forming a larger proportion of the older workforce, it's time we committed not just to ending the gender pay gap but the gender pensions gap too."

'No apology or explanation'

One mum of two, who works in marketing and asked to remain anonymous, said she was missing £4,000 in her pension pot.

The amount was eventually repaid by her employer after she flagged it with them.

But she said there was "no apology of explanation", and she was not compensated for the loss of interest - her pension is currently at 7% growth, meaning she has lost out on hundreds of pounds in interest.

"Given how tough working mums have it at the moment, combined with increasing financial pressures and extortionate childcare costs, I'm disheartened that a big corporate company has chosen to leave me out of pocket due to a technical issue out of my control," she said.

Chloe, 29, a mother of two, said her employer underpaid her by £717.22 while on maternity leave from her role in the aviation industry. She raised the issue and was eventually repaid.

She said her employer was not apologetic and expected the software to calculate it automatically.

Sam, also a mum of two, was missing £1,400 - she had to get her union involved to recover the money.

"I ended up working out the calculations for the missing contributions myself and estimating what their growth would have been over the year - around 10%," she said.

"I eventually was offered a repayment and something like 0.4% interest. I challenged this and got the 10%."

She said her finance director personally apologised to her and thanked her for identifying the issue.

"It turned out to be a longstanding mistake and they were going to identify everyone impacted and restore missed contributions," she said.

How it works in practice - an example...

A woman pays 5% of her salary into her pension pot, a total of £200 of her paycheque. Her employer matches this and also pays £200. This means £400 goes into her pension pot each month.

While on maternity leave, the woman's pay drops and now she pays £100 into her pension pot because the percentage is based on her actual pay received. However, her employer should continue to pay the full £200 as if she had not taken the leave. This means £300 goes into her pension each month.

Why many won't even know they're missing out

Not all women have been repaid.

One mother, who was missing around £250 from six months of maternity leave, said her employer told her they would "look into it" but has yet to repay the shortfall.

"I feel let down as I have had other errors with my maternity pay," she said. "It is challenging enough raising a newborn without having to go through payslips with a fine tooth comb to check for errors. It's tiring having to chase things up and it all feels very unfair."

Harriet Morton-Liddle, co-founder of Nugget Savings, said the organisation had tried to discover why advice on pension contributions during maternity leave was not more clear.

"We contacted HMRC, The Pensions Regulator and Citizens Advice and even submitted FOI requests but still had no straight answer regarding the correct procedure that should be followed for employers or employees," she said.

Much of the online advice was "contradictory", she said, which means many employers may not even realise they are making mistakes.

"We want to raise awareness for the women across the UK who could be impacted but might not even realise it yet, so they can rightfully claim back money that belongs in their pension pots," she said.

How to tell if you have been affected

You need to check with your workplace pension provider - there is usually an online portal to do this, although the amounts contributed may be listed on your paycheque (but it may just list your own contributions).

Your pension provider should also send you an annual statement, outlining how much you and your employer have both contributed.

Check the amounts paid by your employer - both before and after you took maternity leave - are they same? If they have decreased, you may have been underpaid.

What the pension regulator said

When Sky News contacted the pension regulator, Catherine Nicholson, interim director of automatic enrolment, said: "Some employers are making common errors by skipping important steps in respect of calculating pensions contributions and communications to staff. These errors include miscalculating contributions for staff receiving maternity pay."

It said it has recovered more than £700m in missing contributions owed since 2012, but did not have specific figures related to mis-paid pensions while on maternity leave.

The Pension Ombudsman said it did not have any data on this, but said: "We have not seen an increase in complaints stemming from this issue."

It added: "All occupational pension schemes must operate an IDRP [Internal Dispute Resolution Process] If they remain unhappy with the response after the IDRP process they are able to submit a complaint to TPO, we act impartially, and our service is free."

Have you been affected or found discrepancies with your pension payments on maternity leave? Email moneyblog@sky.uk

By Jess Sharp, Money live reporter

It feels like we are saying this a lot recently - but all attention has been on Donald Trump this week.

The US president's swapping and changing decisions on tariffs has sent markets spinning around the world.

On Tuesday, Trump placed tariffs on America's three largest trading partners - China, Mexico and Canada.

Chinese imports faced a 20% fee, while goods from Mexico and Canada were slapped with 25% levies.

A day later, Trump changed his mind somewhat, announcing a tariff exemption for carmakers supplying the US.

Within another 24 hours, he went even further, confirming a one-month reprieve for most goods coming from Mexico and Canada.

That does mean tariffs are still coming, though, and our data and economics editor Ed Conwayhas explained why they are such a big deal...

Trump's unpredictability has further fuelled concerns about the trajectory of the American economy, which has weakened the dollar.

The dollar index was down 3.7% since last week and was on course for its third-biggest weekly drop since 2020.

Sterling shot up against the dollar and tumbled against the euro, meaning buying goods in dollars is cheaper than earlier this week, while euro-priced items are more expensive.

US stocks were heading toward the close of a brutal week after job market data came in closer to expectations than predicted.

At the time of writing this, the S&P 500 was on track for its worst week since September.

Conway looked at the wider impact of Trump's tariffs on the US economy in the piece below...

The focus was on the job market, where the US labour department said employers added 151,000 more jobs to the economy last month - slightly below economists' expectations.

Later this evening, we are expecting Trump to speak about Bitcoin and AI, which could cause more market movements.

He has already confirmed that the US is going to start investing in crypto to create a "strategic reserve".

You can read more about that below...

More cuts in the UK mortgage market

Back on home soil, we saw competition heating up in the mortgage market as two more lenders launched sub-4% deals.

Barclays announced one of the lowest fixed rate mortgage deals on the market with a five-year fix at 3.96%.

Unfortunately, it was only available to customers buying an energy-efficient new-build home directly from the builder or developer, with a 40% deposit.

TSB launched a two-year 60% LTV deal at 3.99%, with a £1,495 fee - but this is only available to customers completing a product transfer.

Elsewhere, cuts were made by lenders Halifax, Gen H and Coventry Building Society as markets started pricing in more Bank of England base rate reductions this year.

Many said all eyes were now on the Bank of England's next base rate decision on 20 March - though, as we've pointed out, uncertainty in global markets caused by Trump tariffs make any downward move appear unlikely.

You can read more about that by clicking our Mortgage Guide below...

Highest fuel prices since September

We also saw the price of fuel hit its highest level since September, with drivers facing five consecutive months of price hikes.

The cost of a litre of unleaded petrol is now 139.65p, rising by 0.65p in February, while diesel went up by 0.73p, according to the RAC.

It now costs around £3 more to fill up a family-sized petrol car than it did in October, at £76.81.

Why are there no bananas?

Despite all of this, one of our most popular reads this week didn't have anything to do with the economy - and everything to do with bananas.

Shoppers were left disappointed after seeing empty shelves in several Tesco stores, with notes replacing the fruit saying there had been a supply issue.

We're signing off for the week now - but don't forget to check out our long read from 8am tomorrow morning.

This week, ourcost of living specialist Megan Harwood-Baynesexclusively reveals thousands of British women could be missing significant sums from their pension due to a "common error" made by their employers while on maternity leave.

One of the Bank of England's most fervent advocates for cutting interest rates has said gradual changes are no longer effective in today's volatile financial markets.

Earlier this week we reported that some members of the Bank's Monetary Policy Committee believe we need even more caution when it comes to cutting rates - but Catherine Mann has set out a very different view.

Her vote in early February (when the committee lowered borrowing costs by a quarter point for a third time to 4.5%) was for a half point cut - and this took markets by surprise.

Speaking to Bloomberg, she said: "Larger cuts, such as the one I voted for in the latest meeting, cuts through this turbulence, with the objective to more effectively communicate the stance of policy and influence the economy."

Mann said she acted aggressively because she felt that the usual signals from policymakers and economic data were being overshadowed by influences from other countries, especially the US. She also pointed out that borrowing costs had changed significantly, even when the Bank hadn't adjusted rates.

While inflation is expected to rise again, she believes cutting rates could help manage this.

The committee will meet on 20 March to discuss another potential cut to interest rates.

It's bad news for Chase customers - the bank is making a major change to its popular debit card and will be restricting the purchases you can earn 1% cashback on.

As part of its Everyday Cashback offer, Chase allowed new and existing customers to earn 1% cashback on most debit card spending worldwide, plus free spending abroad.

But from 7 April, customers will only be able to earn cashback on grocery, transport and fuel purchases made in pound sterling in the UK, Guernsey and Jersey. This will include food bought at supermarkets, but exclude food delivery. Transport includes buses, trains, and ferries (but excludes flights and taxis), and fuel and EV charging away from home, but will exclude home charging points.

Martin Lewis, founder and chair of Money Savings Expert, says it is "bad news".

"It's not quite a 'ditch it', but it's certainly a 'find alternatives'," he says.

New customers will still be able to earn up to £15 a month cashback without needing to pay a minimum amount into their account. But once you've had the account for a year, you'll need to start paying in £1,500 a month.

The British pint of beer and milk will both be safeguarded in law, the government has agreed.

The House of Lords voted this week to ensure pubs can still serve beer in pints - a unit of measurement that survived the country's switch to the metric system in 1965.

The measure bars ministers from preventing, or restricting, the use of the pint in relation to draught beer, cider or milk in returnable containers.

It defines a pint as 0.56826125 cubic decimetres.

Labour's Lord Leong said: "I reiterate that the government has absolutely no plans to change the rules around the use of the pint measurement.

"With the weather finally improving, it is very much my hope that pubs up and down the country will be full of customers enjoying pints of refreshing beer or cider."

Are you finding it more difficult to afford healthy food for you and your family?

We want to hear about your experiences.

Contact the Money team on Whatsapp hereor email us at: moneyblog@sky.uk.

By Sarah Taaffe-Maguire, business and economics reporter

With the "Trump trade" stock market gains a thing of the past, investors and observers are looking closely at economic data coming out of the US.

Today we got official data on wages and jobs for February - the first full month of President Trump's latest tenure.

It was good news for the world's largest economy, 151,000 jobs were added.

The unemployment rate, however, ticked up slightly to 4.1% from 4%. And this may not even capture the full extent of mass public service firings by Elon Musk's Department of Government Efficiency (DOGE).

The readings were taken in the second week of February before many of the sackings took place. But a decline of 10,000 federal workers was still recorded.

Unlike the UK the US's central bank, the Federal Reserve, is mandated to promote maximum employment as well as price stability - ie an inflation rate as close to 2% as possible - so more unemployment ought to push the Fed to cut rates.

Such a cut would likely improve stock markets but is still seen as improbable. Traders are pricing in a 95% chance of rates being held at the Fed's next meeting, as the unemployment rise is small.

John Lewis and Currys staff are the latest to get an inflation-busting pay rise.

The employee-owned partnership which runs John Lewis department stores and the Waitrose supermarket chain said it was investing £114m in a 7.4% pay rise for 65,000 workers across the business.

Some well-performing staff will be eligible for an additional 2% increase, taking the total potential rise to 9.4%.

From 1 April, the minimum rate of pay for workers outside London will increase to £12.40, while inside the M25 it will be £13.85.

Meanwhile, Currys said it would invest £8m in a 6% increase for 15,000 workers.

Staff will now be paid £12.51 an hour outside of London and £13.51 in the capital.

As the end of the financial year looms, several other retailers - including B&Q, Sainsbury's, Marks & Spencer and Costa Coffee - have announced above-inflation pay increases for staff.

The rises will be monitored by the Bank of England, which keeps an eye on settlements to assess whether to lower interest rates.

By Connor Sephton, news reporter

Donald Trump has confirmed that the US is going to start investing in crypto.

According to the Crypto Today podcast, the president is creating a "strategic reserve" that means Bitcoin seized from criminals will be saved on behalf of taxpayers.

Official figures show the American government currently holds more than 198,000 BTC - that's worth about £13.6bn at current market rates.

Before now, crypto confiscated from hackers, thieves and drug dealers has been auctioned off by the US.

But the White House says this approach has caused taxpayers to miss out on billions of dollars in gains.

Back in 2014, the US sold off 79,657 BTC for about £30m. Today, it would be worth £5.5bn.

You might think that Bitcoiners would be ecstatic about this new strategic reserve - but actually, the policy's caused a lot of disappointment in crypto circles.

There had been calls for the US government to buy additional coins for this stockpile, which would have caused BTC's price to spike dramatically.

But Trump's executive order says taxpayer money won't be used to make future purchases.

Bitcoin dropped from £70,000 to £66,000 within 40 minutes of the announcement being made (you can see exactly when in the chart below) but has recovered some of these losses in recent hours.

Only a small number of countries invest in BTC, and it's likely this news will prompt other nations to examine this policy more closely.

The UK currently holds more than £4bn of Bitcoin seized from criminals - but last December, the government said it has "no plans" to follow Trump's lead.

Lord Livermore, a financial secretary to the Treasury, said BTC's volatility makes it "unsuitable as a reserve asset for the UK".

Every week we run our Money Problem feature -WhatsApp us yourshereor emailmoneyblog@sky.uk - with an in-depth answer to your financial dilemmas or consumer disputes. That runs every Tuesday but today we have a shorter bonus edition after this came in from a reader...

I'm a first time buyer, and it's looking more likely that I will have to withdraw from my house purchase due to the potential overnight cost of £5,500 in stamp duty. Are there any options to claim this money from the party that is causing the delay?
James M

For this, we reached out to David Hollingworth from L&C Mortgages. He said...

The increase to the stamp duty nil rate band and extended first time buyer relief in England and Northern Ireland will finish at the end of March. That will see the bandings revert to the levels in place before then, which will see costs rise for many buyers.

First time buyer relief will remain in place but whereas any purchase up to £425,000 would currently pay no stamp duty, anything over £300k will attract a charge from April.

Many will be rushing to meet the completion deadline. There are lots of possible reasons for delays during a house purchase, and the bigger the chain, the harder it will be to manage.

It could be out of the control of your seller and down to reliance on responses from third parties such as freeholders, for example. It could therefore be difficult to pinpoint the loss to one individual's deliberate actions.

However, it will clearly have an impact on your budgeting. Rather than withdraw completely and collapse the purchase, you could raise the problem with the vendor to see if there could be room to renegotiate the purchase price due to the additional cost. That could help you divert funds earmarked as part of the deposit to cover the stamp duty.

Those that want to check the stamp duty charge from April can useour calculator, which is updated with the higher charges that will apply.