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Sixth Report Session 1998-99
Volume 2
OCTOBER 1998 - MARCH 1999
The full report of selected cases
Summary of selected cases
DEPARTMENT OF SOCIAL SECURITY
Delayed payment of contributions to a personal pension scheme
The Contributions Agency unduly delayed crediting Mr P's national insurance account with the national insurance contributions (contributions) that he had paid during the year 1990/91. That in turn delayed the payment of minimum contributions into Mr P's personal pension scheme. After Mr P made representations CA made an ex gratia payment as compensation for the delay. However the payment, as calculated under the terms of the special payment scheme, bought fewer pension units than would have been purchased had the minimum contributions been paid on time. CA declined to compensate Mr P for that actual financial loss. In June 1997 Mr P established that the delay in paying the minimum contributions would also affect the terminal bonus payable when his pension policy matured. Because of the routine destruction of documentation the Ombudsman could not establish the reason for the delay in recording Mr P's contributions. Nevertheless CA apologised for that delay. After the intervention of the Ombudsman CA accepted that Mr P should be compensated for the actual loss his pension scheme had incurred. They made a further ex gratia payment to restore Mr P's pension scheme to the value it would have been but for their maladministration, and to compensate for the potential loss of terminal bonus.
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