EX-Liberal Democrats pensions minister Sir Steve Webb said these letters do not make clear that repaying the money is voluntary.

The Department for Work and Pensions is sending out letters to claim back state pension overpayments to relatives who’ve lost loved ones.

The DWP is writing to families informing them they need to return pension payments made in error. But ex-Liberal Democrats pensions minister Sir Steve Webb said these letters do not make clear that repaying the money is voluntary.

The DWP overpaid more than £500million of state pension and pension credit payments into accounts of those who had died over five years and has only recovered around half of it.

READ MORE Warning issued to anyone who banks with Lloyds, Santander, Halifax, Barclays

Sir Steve said: “It’s not a blunder, it’s just a feature of the system. The question is, what should happen then? And the bit that struck me as odd is that DWP try to get the money back, but don’t have a legal right to insist.”

He pointed out: “Nowhere does it say that this is voluntary. The letter has an FAQ section but none of the questions in it are “do I have to do this?” He added: “And the result, I fear, is that it’s a lottery, and the losers of the lottery are people who are intimidated or frightened or upset by a letter.

“You know, they’ve just been bereaved. They get a letter from the Government demanding hundreds of pounds back, and they just send it because they think they have to.

“They don’t want, you know, they perhaps fear a knock at the door kind of thing, whereas other people, who perhaps are aware they don’t have to pay it back or just choose not to, don’t.”

He said: “This kind of halfway house of … we know that it’s not mandatory when we send the letters, but we’re not going to tell you…that doesn’t seem right to me.”

A DWP spokesperson said: “It is not our intention to cause distress, however, we have a responsibility to taxpayers to recover overpayments. We acknowledge this is not always possible.

“Whilst there is no legal obligation to repay a debt of this type, we recognise some people will be willing to repay money to which there was no entitlement. We provide full contact details and encourage anyone with concerns to call us.”