Minister for Pensions (): On 18 December 2025,
NS&I notified the Treasury of a failure to comprehensively
trace accounts for some customers who passed away. The result of
this failure is that not all savings were identified by NS&I
and paid to the beneficiaries of their estates.
Specifically, processes failed to comprehensively trace some
customers' holdings where those were spread across multiple
profiles or systems despite consistent identifying details such
as name, address and date of birth, that should have made that
possible.
There have been wider related historical challenges, for example,
the FCA took enforcement action in 2018 against Santander
relating to the tracing of accounts following bereavement claims.
It is now clear that NS&I did not respond to these warning
signs as fully as we in the government, and more importantly
their customers, would expect.
Action so far
Since being notified of this issue, HM Treasury has ensured
external advisers, including EY and Herbert Freehills Kramer, have been engaged
to identify the scale of these errors. Through this work NS&I
have reviewed 34 million customer records.
Their work is ongoing, but points to up to a maximum of around
37,000 customers, with up to £476m in deposits, being affected.
This number is likely to fall in future, but while it currently
represents less than 0.2% of NS&I's customers, it is still
far too many.
NS&I is not regulated by the FCA, but the Government expects
it to live up to the same standards as regulated deposit taking
banks. It is therefore right that NS&I is apologising for
these failings today.
The Government's priorities are now threefold:
Fixing the problem going forward
First, and immediately, to ensure that the problem is no longer
taking place.
NS&I have received written assurances from their customer
facing supplier, SSL, that the causes of this tracing issue have
been addressed and will not affect customers going forward. Their
previous supplier, Atos, has also committed to full cooperation
given this issue is long standing.
Reuniting funds and compensation
Our second priority is to ensure that we reunite beneficiaries of
those customers who have passed away with any funds that NS&I
holds.
We can confirm that those savings are 100 per cent safe. This
issue is about tracing, not the security of any funds.
NS&I has put in place a dedicated programme team to oversee
this work, hiring an additional 100 staff and will be publishing
a delivery plan in May, detailing how they will take forward this
work to reunite funds with their owners.
This will cover:
- the numbers of cases affected
- how NS&I will proactively contact representatives of
estates to ensure they receive the funds they are due, including
interest on savings;
- and the compensation that, where appropriate, will be paid.
There is no need for individuals to utilise a claims management
company or solicitor to reclaim this money. The onus is not on
individuals but on NS&I to act and to contact estate
representatives and reconnect beneficiaries with the money they
are due. We are committed to ensuring NS&I support those who
have experienced a loss by making the process for reuniting
beneficiaries with their money as easy as possible.
We also recognise that there may be tax implications for affected
estates, and want to avoid bereaved families facing
disproportionate disruption and administrative costs as a result
of this error. We are exploring what support we can provide and
will set this out alongside NS&I's Delivery Plan.
Further information is available on the NS&I website and
their contact centre is open seven days a week.
To confirm, current NS&I customers can access their accounts
as normal. Any customers wishing to trace old accounts can use
the tracing services direct through NS&I or the My Lost
Account website.
The organisation
NS&I plays an important role, helping the public save and
providing a material contribution towards government financing.
The organisation must continue to play that role, while also
addressing the tracing issue.
NS&I must also complete what has proved a challenging digital
Business Transformation Programme. This programme was put in
place back in 2020 but with little progress made in the latter
years of the previous Parliament, as the recent Public Accounts
Committee report set out. This Government has appointed – former Chief Operating
Officer at the Ministry of Defence – to support NS&I to bring
the programme back on track.
It is important that NS&I has the very best leadership in
place. Effective from today, we have appointed Sir , former HMRC First Permanent Secretary, to take over as
Chief Executive of NS&I on an interim basis, to provide a
fresh start for NS&I's next phase of development. We would
like to thank Dax Harkins, his predecessor, for his 22 years
public service at NS&I.
As well as providing leadership to the organisation, Sir Jim will
undertake a review over the next three months to spell out in
detail the background to this tracing problem, and to set out
what lessons must be learned for NS&I going forward.
We will ensure Sir Jim's review is shared with the Chairs of the
Treasury and Public Accounts Committees upon completion.
