A million NOW: Pensions members due compensation
The Pensions Regulator (TPR) has fined NOW: Pensions a total of £70,000, made up of a £50,000 fine for failing to process core financial transactions accurately and promptly, and £20,000 for failing to report late or missing contributions to some members.
The regulator has also set NOW: Pensions – one of the largest auto-enrolment providers – an April deadline to fix the long-running issues with the pension scheme and tasked it to set up a compensation scheme for those impacted as a result of the “persistent administrative failings”.
NOW: Pensions has 1.5 million members and it confirms two-thirds (one million members) have experienced some delay in their savings being collected from employers and therefore not invested.
Given its average pot size is £385, NOW: Pensions said the typical adjustment, or compensation, will be £2, thought it could be larger or smaller depending on the amounts and delay experienced by members.
It confirms scheme members don’t need to take any action as they will be put back into the same position as they were previously.
The c. £2m compensation will be paid by NOW: Pensions and won’t come out of members’ funds.
Nicola Parish, TPR’s executive director of frontline regulation, said: “This package of measures, together with those voluntarily taken by the trustee, should ensure that the issues with NOW: Pensions which have persisted for so long are finally resolved.
“We will continue to monitor progress and will issue further fines if necessary to ensure that the trustee and NPL focus on resolving the issues as swiftly as possible.
“Trustees, sponsors and administrators should be in no doubt that we will act if we are concerned about the way schemes are being run.”
NOW: Pensions said the delays arose when it received inaccurate, incomplete or missing payroll data from employers, such as missing date of birth, National Insurance number of information relating to the wrong period. This meant the data was held in its system so it couldn’t be verified and invested.
Troy Clutterbuck, Interim CEO, NOW: Pensions Limited said: “I am truly sorry for the delays that some clients have experienced processing pension contributions. We’ve been working closely with The Pensions Regulator on the steps detailed in the Improvement Notice and Third Party notice and have made significant progress. I’m pleased to say that the vast majority of schemes are now up to date. Work continues on a small percentage of larger and more complex schemes and these will be updated by April – the deadline set by the Regulator.”