Pension Adminsitrator problem!

jem16

Womblesw20 wrote: »

To quote RPPD Principle 6 – ‘A firm must pay due regard to the interests of its customers and treat them fairly, this certainly doesn't put my mother interests at the heart of how this firms does business...

I know this is an emotive subject for you but let's look at it from a slightly different scenario.

Two years ago your Mum passed away and your Dad moved away from the family home into a care home/sheltered housing/son or daughter's house. Their joint bank account changed over to a single account in your Dad's name but sort code and account number stayed the same.

Unfortunately, due to grief, Mum's pension provider was not notified and payments continued to be paid into your Dad's account for 17 months. Payments stopped after 17 months because the post was now being returned as "gone away".

7 months later the family notice the payments have stopped and get in touch with the pension provider. The pension provider realises that the pension has been paying out for 17 months when it shouldn't have been and ask for the overpayments back. The family are horrified and say Dad cannot afford to pay all this money back and feel that this is unfair.

However it could have been worse if the pension provider had continued to pay out whilst attempting to trace your Mum (whilst treating her fairly and with due regard to her interests ) as there would then have been more to pay back. So family are even more annoyed as the payments could have been stopped 7 months prior to that.

It seems that insurance/pension companies are damned if they do and damned if they don't.

Womblesw20

Agarnett / Wooly Wobat - Thanks you for your comments. I too am disappointed by the tone of some of these individuals but to be honest, having witnessed them on previous posts, I'm not really surprised. Yes, I am there carer here and accept responsibility for missing this - but thoroughly refute suggestions that it was due to being preoccupied / interested in own family. It's too easy to just make assumptions based on your prejudice and stereotype - judge me only when you have walked in my shoes. Trying to support a dementia suffer who is reluctant to give up their independence but incapable of managing their financial affairs is tough and heart wrenching but according to some I'm too busy to really care about my ageing mother. You have no idea but hey, ignorance is bliss.


The real point of post was to flag an inherently unfair practice that the pension industry seem to have adopted which according some on this post is acceptable - because it's standard practice, or it's down to the family's carer to pick up. The most vulnerable in society will be the victims here but it's the bigoted attitudes from industry 'experts' like this that further tarnish the financial service industry.

agarnett

Hear Hear!

It is the "business as usual" brigade who unwittingly (I say that in the most generous terms) are the most responsible for the shadowy corporate cultures we have to endure. It is extremely difficult to break some of those cultures when those operating at an ordinary level within them would rather use their wit to support the company line and gain reward for being yes people rather than in setting proper standards and getting things improved for customers. I for one have suffered real scars from my efforts inside the industry, whilst others who have fought for the status quo against me have prospered at the consumer's expense.

You are right - you have indeed highlighted a practice which is just not good enough.

The whole of the financial services industry is shamefully hopeless at ensuring reliable client correspondence channels at all times and dealing with deceased customers. They even outsource the latter to save costs.

Then they have the cheek to claim it is for consumer benefit and in some way anti-fraud. Misguided would again be a generous word for it all !

jem16

Womblesw20 wrote: »

The real point of post was to flag an inherently unfair practice that the pension industry seem to have adopted which according some on this post is acceptable - because it's standard practice, or it's down to the family's carer to pick up. The most vulnerable in society will be the victims here but it's the bigoted attitudes from industry 'experts' like this that further tarnish the financial service industry.

So would you have been happy for your Dad ( who would presumably be another vulnerable member of society) to have to pay back a large overpayment because the insurance company was protecting ( in your eyes ) your Mum's interests?

Unfortunately I have seen many threads on here where that is judged unfair practice and many don't think they should have to pay it back.

PensionTech

Put yourself in the shoes of a pension scheme. Let's say that you have been asked to pay £100 every month to a 70 year old who lives at the other end of the country. You have their address, but nothing else. You have never met them. You don't know anyone who knows them. You send them payslips every year but that's the only contact you ever have. You are only allowed to stop paying them the £100 when they die. In fact, more than that - if you do pay them any money after they die, you get hit with a big tax fine, and have to spend lots of your own time and money trying to get any overpayments back, despite ultimately having to rely on that person's beneficiaries - whom you don't like bothering, because they're grieving - to take pity on you and arrange for the cash to be sent back to you, assuming it's still available. You are relying on that person's beneficiaries to tell you as soon as the person dies, even though:
a) they might not know you exist,
b) they might be too distressed to deal with the practicalities for a while, or even
c) they might deliberately decide not to tell you so that they can keep collecting the £100 each month. (Yes, it happens, unhappily often. I am currently dealing with two such cases. I have even dealt with cases in the past where the family didn't just fail to notify us of the death, but actually forged correspondence from the dead person, to convince us that they were still alive. And remember - I'm sure you're a decent sort and would never do that kind of thing - but before you think about being outraged, how is someone in an office who doesn't even know your name meant to judge that?)

Let's also point out that it's not as easy as just Googling a name and finding out when the person has died - you have to go through months of work, and pay for services, to track them down if you lose track of them. If you find them, and they appear to be alive, you have to send them a letter - with no personal details, in case you have the wrong person and are about to disclose personal information about your ward. You then have to wait for them to get back in touch to prove that they are who they say they are before you can actually confirm that they're still alive. And if they don't pay attention to the payments from you, because it's only small and they have lots of others, etc., then they may never bother getting in touch anyway.

So that's the situation. What happens when, out of the blue, when the person is (say) 80 years old, one day you suddenly get a payslip returned saying "gone away", and you happen to know that this is often a sign that someone has passed away? Do you keep on blithely paying the £100 every month, even though it's going to cause a world of pain for you and everyone else involved if they've died? Or do you stop the payments until you find out whether they're still alive?

I hope this helps you understand why pensions get suspended in the first place. However, you do raise a valid point:

Schemes should try to trace members when they suspend their pensions. Tracing services, as I've explained above, are not infallible; they're expensive and time-consuming and sometimes inaccurate. But generally you would hope that a pension scheme would attempt to find a member rather than just assuming that they've died and not doing anything about it. I don't know if you have any evidence that the scheme didn't lift a finger to try to trace your mother. Quite often schemes will do bulk tracing exercises periodically to find several members, rather than as and when each one goes missing, because it's costly - and don't scoff at cost, because a scheme's costs are ultimately the members' costs. So there might be a delay in starting the tracing efforts. But it's possible that they should have got around to it sooner.

It's not, however, as outrageous as you're making out. If somebody truly relies on a pension to stay alive then it's incredibly rare that they will fail to tell that pension scheme when they change address or bank details, and as soon as they miss a payment, the person gets on the phone with the administrator. You just don't treat an income that you rely upon so indifferently. And the administrator will often then arrange for an emergency payment to be made to cover any arrears.

I know you're annoyed, but administrators don't just do this because they're evil and don't care about people, or because they want to make money (administrators are usually separate from the fund so they wouldn't make any money from withholding payments). All the work involved in suspending and reinstating the pension costs money. They do it because they're required to and because it's pragmatic.

RichandJ

PensionTech wrote: »

Put yourself in the shoes of a pension scheme. Let's say that you have been asked to pay £100 every month to a 70 year old who lives at the other end of the country. You have their address, but nothing else. You have never met them. You don't know anyone who knows them. You send them payslips every year but that's the only contact you ever have. You are only allowed to stop paying them the £100 when they die. In fact, more than that - if you do pay them any money after they die, you get hit with a big tax fine, and have to spend lots of your own time and money trying to get any overpayments back, despite ultimately having to rely on that person's beneficiaries - whom you don't like bothering, because they're grieving - to take pity on you and arrange for the cash to be sent back to you, assuming it's still available. You are relying on that person's beneficiaries to tell you as soon as the person dies, even though:
a) they might not know you exist,
b) they might be too distressed to deal with the practicalities for a while, or even
c) they might deliberately decide not to tell you so that they can keep collecting the £100 each month. (Yes, it happens, unhappily often. I am currently dealing with two such cases. I have even dealt with cases in the past where the family didn't just fail to notify us of the death, but actually forged correspondence from the dead person, to convince us that they were still alive. And remember - I'm sure you're a decent sort and would never do that kind of thing - but before you think about being outraged, how is someone in an office who doesn't even know your name meant to judge that?)

Let's also point out that it's not as easy as just Googling a name and finding out when the person has died - you have to go through months of work, and pay for services, to track them down if you lose track of them. If you find them, and they appear to be alive, you have to send them a letter - with no personal details, in case you have the wrong person and are about to disclose personal information about your ward. You then have to wait for them to get back in touch to prove that they are who they say they are before you can actually confirm that they're still alive. And if they don't pay attention to the payments from you, because it's only small and they have lots of others, etc., then they may never bother getting in touch anyway.

So that's the situation. What happens when, out of the blue, when the person is (say) 80 years old, one day you suddenly get a payslip returned saying "gone away", and you happen to know that this is often a sign that someone has passed away? Do you keep on blithely paying the £100 every month, even though it's going to cause a world of pain for you and everyone else involved if they've died? Or do you stop the payments until you find out whether they're still alive?

I hope this helps you understand why pensions get suspended in the first place. However, you do raise a valid point:

Schemes should try to trace members when they suspend their pensions. Tracing services, as I've explained above, are not infallible; they're expensive and time-consuming and sometimes inaccurate. But generally you would hope that a pension scheme would attempt to find a member rather than just assuming that they've died and not doing anything about it. I don't know if you have any evidence that the scheme didn't lift a finger to try to trace your mother. Quite often schemes will do bulk tracing exercises periodically to find several members, rather than as and when each one goes missing, because it's costly - and don't scoff at cost, because a scheme's costs are ultimately the members' costs. So there might be a delay in starting the tracing efforts. But it's possible that they should have got around to it sooner.

It's not, however, as outrageous as you're making out. If somebody truly relies on a pension to stay alive then it's incredibly rare that they will fail to tell that pension scheme when they change address or bank details, and as soon as they miss a payment, the person gets on the phone with the administrator. You just don't treat an income that you rely upon so indifferently. And the administrator will often then arrange for an emergency payment to be made to cover any arrears.

I know you're annoyed, but administrators don't just do this because they're evil and don't care about people, or because they want to make money (administrators are usually separate from the fund so they wouldn't make any money from withholding payments). All the work involved in suspending and reinstating the pension costs money. They do it because they're required to and because it's pragmatic.

This. X 1,000.

Administrators are often dealing with multiple schemes with member aggregates in the thousands. They're not "bigoted", evil or uncaring, they simply don't have time to look at each member as an individual.

Sorry if this hurts your feelings OP, but it is the way it works.

agarnett

There's a bunch of industry apologists in this forum who need their sorry a$$es kicked.

The reason we don't have central databases maintained by a trusted government which feed directly into every bank customer's record, every energy company's customer records, every health service record, every citizenship record, every insurance record, every pesnions record and every register of births and deaths record, is because habitually over the past few decades of easy computerisation, it has not suited any of these institutions to have their business so closely accessible to successive governments. Especially pensions. Our largest corporates are responsible for our largest pension schemes. They are more powerful than successive governments. Silo operations suit them.

Billions are made by "oversights", "untraced assets", "orphan investments", late cancellations, late notifications. late transactions - now just as they always have been, by service companies. However, when computers began to be so useful that transparency started emerging, it became harder to cream off, siphon off or even earn off these "lost funds". So opaqueness was built in again.

When you die, or get lost it suits most companies just fine to suspend or delay payments until they receive the right paperwork. How many certified copy death certificates does it take to get a typical deceased persons affairs in order?

It would be so so easy for a government computer record marked "deceased" to trigger every single bank account, insurance company record, pension record, utility company record to the right action. Accounts would be properly frozen pending correct authorised access, documents would be issued to the correct parties and there would be far fewer mistakes and upsets. So why do we not have such a system?

Same for when a citizen updates their address. They change it once and they need never give it again for their next car insurance or home insurance or pension or bank communication whether it be for new business or existing business. Why do we not have such a system?

Of course this type of efficiency does not suit many in our society who like to be able to wheel and deal before officially notifying anyone of material changes, or before officially acknowledging official changes.

Far better to hang on to money or divert it into "lost accounts" status at the most feeble excuse and argue that it is done for the common good. Especially if you can get the government to agree to it - hell, maybe some of the "lost" money could even make it back to the common good like lottery money! But not all of it of course. Tracing is expensive.

I am almost nauseated by the b¤ll¤x propounded in the last two or three posts and those queuing up to thank the posters.

You are all advocating no change to a system for which you seem to have no original ideas whatsoever for how easily it could be improved, primarily perhaps because you are blinkered by your own limited experience, not enlightened by it, so you urge that it is right because "that's the way it works", and it has suited you and your associates to "work" in such piecemeal amateur ways for as long as you can remember.

Get over yourselves, please and look at how you personally could improve the big picture.

We were once supposed to be good at administration and services in the UK. Well wake up - sure we're great at high frequency trading using the most up to date computing available to optimise returns for corporates using customers' or pension scheme members' money, but we are totally second rate when it comes to keeping accurate records of the citizens for whom we hold the money we play with in trust, and for whom we maintain and manage the necessary personal data - that's because there is no corporate interest and no profit in doing the latter, and no pride in accurate record-keeping generally except in relation to corporate bottom lines - and even then it gets fudged mercilessly.

Just one great fudged up mess. Where there's fudge and confusion there's brass. That's UK.

Our senior citizens are targets because they are easy to short change in so many ways. Let them eat fudge ... :mad:

jem16

agarnett wrote: »

It would be so so easy for a government computer record marked "deceased" to trigger every single bank account, insurance company record, pension record, utility company record to the right action. Accounts would be properly frozen pending correct authorised access, documents would be issued to the correct parties and there would be far fewer mistakes and upsets. So why do we not have such a system?

Let's hope we never have such a system!

Smacks too much of Big Brother to me and just think of the chaos if this wonderful computer system ever went wrong. It's bad enough when one computer system goes down - think RBS and many locked out of their bank accounts for days - but when this central system goes down? Doesn't bear thinking about!

I only have to think back a few years when my then 21 year old son was marked as deceased by HMRC due to an error by the pension provider when finishing off the pension provided by his late father's scheme. It was bad enough having to sort this out without also having him locked out of everything.

Womblesw20

Jem16 - I agree that it is only fair for the recipient to payback any overpayments due. The point is, this could be avoided by making some attempt to trace the pension holder. I'm guessing most pensions are paid by direct debit into the pension holder's bank account - I can't believe it's that hard to trace them from there?


RichardJ - appreciate your comforting sympathy around my hurt feelings here. I guess that, as "that's the way it works" we should just accept the practice. Thanks for this very profound insight. In fact, we should all take this attitude when it comes to financial services. Bring back the good-old days of PPI & pension miss-selling, not to mention LIBOR...

jem16

Womblesw20 wrote: »

Jem16 - I agree that it is only fair for the recipient to payback any overpayments due. The point is, this could be avoided by making some attempt to trace the pension holder.

I think that's been covered earlier in the thread.

I'm guessing most pensions are paid by direct debit into the pension holder's bank account - I can't believe it's that hard to trace them from there?

Data Protection wouldn't allow it.