In February 1917, the Ministry of Pensions took over from the Admiralty, the War Office, the Army Council and the Chelsea Hospital commissioners responsibility for administration of naval and military death and disability pensions and allowances, including naval and military nursing services, arising from the First World War or granted prior to 18 September 1914. The Ministry later administered similar Royal Air Force pensions under the Air Force (Constitution) Act 1917. The new Ministry also took charge of certain special pensions, including pensions paid under the Naval and Marine Pay and Pensions Act 1865 as supplements to Greenwich Hospital pensions to dependants of naval seamen and royal marines whose deaths were attributable to service other than warlike operations. From 1920, the Ministry administered pensions formerly paid by the Admiralty to merchant seamen employed in fleet duties. The Ministry administered the Greenwich Hospital pensions, and service pensions held in conjunction with war disability pensions granted since 18 September 1914. These arrangements continued until March 1924 and March 1925, respectively.
The service departments had in 1917 retained responsibility for service pensions (including those partly based upon disablement), gallantry and special campaign pensions, Chelsea Hospital in-pensions and pensions from Greenwich Hospital funds (with the exception of the agency arrangements mentioned above). They also continued by special arrangement to deal with disability pensions held in conjunction with pre-war service pensions, which were paid quarterly through regimental paymasters. The scheme of mercantile marine and fishing fleet war pensions also remained outside the control of the Ministry of Pensions and was administered from 1915 by the Board of Trade. After the war the Ministry's powers were reduced. In 1921 responsibility for peacetime death and disability pensions and allowances and the special pensions was restored to the service departments. The Ministry of Pensions retained control of the general war pensions arising from the War of 1914 to 1918 and former wars, and from August 1920, took charge of 'officers' wounds' pensions arising from the War.
In 1917 the Ministry took over the central Army Pensions Issue Office and the Naval Pensions Branch. The statutory committee also continued to function under the direction of the Minister of Pensions until its dissolution in September 1917. Its executive functions, including the administration of separation allowances, the payment of supplementary pensions and allowances, and the provision of medical treatment and training, together with most of its staff, were taken over by the new Ministry. Its quasi-judicial functions passed to a Special Grants Committee charged with the determination of questions on reference from the Minister. Local committees were brought under the control of the Ministry, until the War Pensions Act 1921 empowered the Minister to dissolve such committees, to assume their executive functions and to appoint advisory War Pension Committees. A Central Advisory Committee on War Pensions was constituted to advise the Minister on questions referred to it.
Towards the end of the First World War, Pensions Appeal Tribunals were first appointed to deal with appeals against decisions of the minister. Arising from claims for pensions from ex-servicemen or their widows or dependants, a Pensions Appeal Tribunal was set up in 1917. This operated in an advisory capacity as a branch of the Ministry of Pensions. In November 1919 independent tribunals were established under the War Pensions (Administrative Provisions) Act 1919 to consider and decide appeals from claimants. By the War Pensions Act 1921 tribunals' jurisdiction was extended to appeals against decisions of the Ministry of Pensions concerning final award and assessment. With the outbreak of the Second World War and the extension of the conflict to the civilian population provision was made under the Pensions Appeal Tribunals Acts 1943 and 1949 for consideration of appeals concerning the award of war pensions as a result of service whether in the armed services, mercantile marine, civil defence or as a civilian. The appointment and regulation of Pensions Appeal Tribunals in England and Wales has been the responsibility of the Lord Chancellor.
During the Second World War the Ministry was made responsible for wartime death and disability pensions for the armed services and, the mercantile marine. The Ministry of Shipping (1939 to 1941) and later the Ministry of War Transport took over from the Board of Trade responsibility for pensions from the First World War. The Personal Injuries (Emergency Provisions) Act 1939 provided for pensions for personal injuries sustained as a result of enemy action by nurses, civil defence workers and civilians. At the end of the war the Ministry continued to administer these schemes and in 1949 also took charge of future peacetime disability pensions for members of the armed forces.
The internal running of the Ministry of Pensions was carried out by an Establishments Division which also dealt with certain aspects of local administration and the investigation of claims. A General Administration and an Awards Division determined policy with regard to pensions and claims to entitlement. During the Second World War, the latter was split between the Great War, Civilian and Mercantile Awards Division and the New Services Awards Division. After the Second World War, these functions were dealt with by the General Division (later the Pensions Policy and General Division), an Awards Division stationed at Blackpool, and a Rehabilitation and Welfare and London Awards Division (by 1953 carried out by a separate division at Blackpool). A Pensions Division in London dealt with awards, appeals and national service grants.
The Ministry of Pensions also administered war pensions abroad of ex-servicemen from the British Empire and Commonwealth, the majority of whom lived overseas and of ex-servicemen from Britain itself who were living abroad inside and outside the Commonwealth. The Ministry had its own offices in Dublin to cover Southern Ireland, in Ottawa (from 1926) to cover Canada and later North America in general, and in Melbourne (after the Second World War) to cover Australasia. Otherwise pensions were paid through the Embassy and Consular organisation in foreign countries, or through a command paymaster, colonial treasurer or other appointed official.
In 1953 the pension functions of the Ministry of Pensions were combined with the pensions and insurance duties of the Ministry of National Insurance, to form a new Ministry of Pensions and National Insurance. Within the Ministry, a separate War Pensions Branch existed. In April 1954 the new Ministry also took over the administration of death and disability pensions for merchant seamen and fishermen killed or injured in the First World War which had formerly been administered by the Ministry of Transport and Civil Aviation.
In 1966 the Ministry of Pensions and National Insurance was abolished and its functions passed to the Ministry of Social Security and the Supplementary Benefits Commission.
In 1968, the divisions of the short-lived Ministry of Social Security were absorbed into the new Department of Health and Social Security (DHSS) with little evident change. The War Pensions Department existed until 1971 before evolving into the War Pensions and Industrial Injuries Division. After 1973, the war pensions functions were split between branches of the Social Security Policy Group. Blackpool Central Office, re-named North Fylde Central Office in the late 1970s, remained the principal centre for the administration of war pensions and pension records, including the issue of pension books.