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NS&I’s ‘reputation damaged’ despite chief’s apology over poor service

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22/01/2021
Despite the NS&I chief’s apology to customers over the poor service they experienced, an influential group of MPs said the damage to its reputation may have been done.

Against the pandemic backdrop, rising cash deposits and NS&I offering a number of best buy deals, it was met with “unprecedented demand” which resulted in poor service for its customers.

Many were forced to wait an average of 20 minutes for calls to be answered at a time when it was experiencing reduced staff numbers due to Covid-related factors.

This was exacerbated by NS&I’s decision to phase out Premium Bond prize warrants (paper cheques), and severe cuts to interest rates on popular products.

NS&I – the government’s savings arm – revealed that it had nearly 6,000 outstanding complaints at the end of December 2020, the majority of which were focused on changes to Premium Bonds and issues customers faced with reaching contact centres.

In December, the Treasury Select Committee wrote to Ian Ackerley, chief executive of NS&I, to express concern about its standard of service, a big rise in complaint numbers and the anxiety caused to customers over its decision to cut interest rates and phase out paper warrants.

The MPs requested Ackerley to respond to specific questions about its operations during the pandemic and today, NS&I’s response has been published.

‘I am very sorry’

Ackerley wrote: “I am very sorry for those customers who experienced poor service last year and I am determined to return NS&I to delivering the high quality service our customers have been accustomed to for many years now.

“For a number of months, NS&I experienced extremely high demand for our products and services, against a backdrop of reduced operational capacity due to the impact of pandemic-related factors on staffing levels. The unforeseen increase in the size of the overall savings market drove deposits to unprecedented levels. Regrettably, the combination of exceptional demand and significantly reduced capacity resulted in customers experiencing significant delays to call answering times and replies to correspondence, although our online services have continued to be available.”

Relating to its decision to phase out paper warrants, Ackerley responded: “I regret that we undertook this change at a time when our operations were under stress. I have delayed the phasing out of prizes by warrant (cheque) until the spring, and we are using this time to improve processes, strengthen our communication to our older and vulnerable customers and ensure that when we resume, we are in a robust position operationally and can answer queries promptly.”

He added that in April 2020 at the start of the Covid-19 pandemic, NS&I issued over one million prize warrants but just under 600,000 of these warrants were cashed.

‘The damage may have been done’

Mel Stride MP, chair of the Treasury Committee, said: “An exodus of savers from NS&I when it cut interest rates in November was foreseeable and so it is disappointing that the average time to answer a customer’s call was 19 minutes that month.

“I would like to thank Mr Ackerley for his frank response, but the damage that may have been done to NS&I’s reputation over the last few months is worrying.

“NS&I has a big role to play in helping the government fund the costs of the coronavirus recovery scheme and it will need to work hard to win back customers.”

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