Campaigners battling for state pension compensation have issued the Government with a formal ultimatum, warning that they will pursue a judicial review unless ministers rethink their refusal to pay out billions to millions of 1950s-born women.

The Women Against State Pension Inequality (Waspi) group claims 3.6 million women were short-changed because the Government failed to provide adequate warning when it raised the state pension age from 60 to 65, and later to 66. These changes date back to legislation introduced in the 1990s, but many women were not notified until years later, leaving them with little time to adjust retirement plans.

Although Work and Pensions Secretary Liz Kendall apologised for the delays in communicating the changes, she maintained there was no “direct financial loss” and has declined to offer compensation. According to Ms Kendall, awareness of rising pension ages was already significant, so earlier notification would not have altered many women’s retirement decisions. Waspi, however, contends that a lack of timely information led directly to financial hardship.

Last year, the Parliamentary Ombudsman suggested a one-off payment of up to £2,950 to each affected woman, highlighting a 28-month gap in notifying them of the new state pension age. Waspi describes the Government’s stance as an “outrage” and says ministers are effectively “gaslighting” those who had no realistic opportunity to prepare for longer working lives. The campaign group has launched a crowdfunding appeal, hoping to raise £75,000 to fund its legal challenge.

If the courts side with Waspi, analysts estimate the final compensation bill could reach as high as £10.5bn—an amount the Government insists public finances cannot stretch to, particularly amidst ongoing economic pressures. Labour leader Sir Keir Starmer has also ruled out large-scale compensation, citing constraints on the national budget.

Despite political hesitancy, Waspi chair Angela Madden says the group has been left with no alternative but to take legal action. “We will not allow the DWP’s gaslighting of Waspi women to go unchallenged,” she said, adding that they will stand firm until ministers recognise the hardship caused by later-life pension changes.

With a judicial review potentially just weeks away, the row over what many view as a significant maladministration case shows no sign of abating. For the Treasury, any unfavourable court verdict could spark considerable pressure to reopen the issue—and billions in potential liabilities.

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Waspi campaigners threaten legal action as pension compensation row deepens