A penalty of £50,000 for failing to process some core financial transactions promptly and accurately and a penalty of £20,000 for failing to report late or missing contributions to some members.
The penalties will be paid by NOW: Pensions Limited and will not come out of members’ funds.
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.”
Nigel Waterson, Chair of Trustees, NOW: Pensions said: “I want to emphasise that all money we’ve received is completely safe. We’ve analysed each and every member record and if a member has experienced a delay, we will make sure we put them back in the same position they would have been in had their contributions been processed in a timely manner. Our average pot size is £385 so the typical adjustment will be less than £2. Our approach to doing this has been shared with the Regulator and approved by an independent actuary.”
What caused the delays?
These delays arose when NOW: Pensions received inaccurate, incomplete or missing payroll data from employers – such as a missing date of birth, National Insurance number or information relating to the wrong pay period. This data has been held in our system and hasn’t been able to move forward to the next stage where it’s verified and ultimately invested.
Troy Clutterbuck continued: “To stop this from happening again we have reviewed and improved our processes and controls. As part of this, NPL has invested more than £4m in our own market-leading auto enrolment system called the NOW: Pensions Gateway.
“Over 85% of our clients are already on Gateway and the platform ensures that poor quality or incomplete data is not accepted and that employers receive immediate detailed feedback as to the reasons why so that the data can be correctly and successfully resubmitted. All remaining clients will be moved onto this system by April and it is working extremely well.”
Nigel Waterson continued: “The Trustees have agreed a timetable with the Regulator to resolve these legacy issues. We continue to work closely with the Regulator and with independent trustees Dalriada Trustees to ensure that this is done on time. Considerable progress has already been made towards the April deadline.”
Why did NOW: Pensions fail to report late or missing contributions to some members?
All providers must write to members within 30 days of reporting employers to TPR for material payment failures. Although NOW: Pensions has been carrying out its duties, reporting employers to TPR for material payment failures, due to human error, there was a short period when reporting to some affected members did not take place. This was identified and immediately put right. The Regulator acknowledges there was no material detriment to members.
Troy Clutterbuck continued: “As one of the largest auto enrolment providers, we remain very much open for business. We will continue to play a key role in safeguarding the success of the policy so that it delivers on its promise of providing millions more people with a better retirement.”
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