Thousands of people who are helping to bring up their grandchildren could be missing out on credits that protect their pension, research has found.
A freedom of information request submitted to Revenue and Customs by Royal London revealed that only a low number of applications had been made.
Under the rules on specified adult childcare credits, if a mother goes back to work after the birth of a child she can sign a form that allows a grandparent or other family member to receive national insurance credits for looking after the child.
Grandparents who give up their job to look after a child could otherwise be losing out on their pension. If a working-age grandparent misses out on one year of state pension rights, this would cost them one 35th of the full rate state pension, or £231 per year. Over the course of a 20-year retirement they would lose more than £4,500.
Royal London said it had found a “massive non take-up” of the scheme, which is benefiting an average of just two grandparents per parliamentary constituency. It found that 1,298 grandparents and other family members benefited in the 12 months to last September. The numbers have dwindled compared with two years earlier, when 1,725 were benefiting.
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The insurer said its calculations suggested more than 100,000 grandparents of working age could benefit if the scheme was more widely known about. It said more should be done to alert people, particularly new mothers.
Sir Steve Webb, the former pensions minister who is director of policy at Royal London, said: “The scheme is not much use if hardly anyone takes it up.”
Lucy Peake, chief executive of the charity Grandparents Plus, said grandparents were “a lifeline to families squeezed by falling incomes and rising childcare costs. When they give up their own jobs to help out, they shouldn’t damage their future state pension.”