Minister for Pensions (): I am today updating the
House on the steps being taken to address historic failures in
the handling of some bereavement claims by National Savings and
Investments (NS&I).
On 26 March 2026 I informed the House that NS&I had
identified a population of cases where, following notification of
a customer's death, holdings were not fully settled in a timely
way. These failures relate to past tracing and operational
processes and do not reflect current practice. I recognise the
distress and inconvenience that these shortcomings may have
caused to those that have suffered bereavements.
The Treasury has instructed NS&I to put this right swiftly
and fairly, requiring a delivery plan detailing how they plan to
do so to be published during May.
NS&I has now completed extensive work to understand the
affected population and to design a remediation approach. Today
NS&I is publishing the Delivery Plan that they will follow to
ensure proactive timely contact, payment of outstanding holdings,
and appropriate compensation.
The current remediation population is estimated at up to 34,000
cases, with a total value of approximately £367 million. These
figures have reduced since my announcement and are likely to
reduce further.
We are committed to making the process for reuniting estates with
their money as easy as possible. NS&I will contact all
affected estates with holdings of £10 or more to reunite them
with the full value of those holdings that should have been
returned to them earlier. To ensure estates have not been
disadvantaged by the delay, this will then be adjusted upwards to
include either the higher of the interest accrued since the error
occurred or the Bank of England base rate plus one percentage
point, in line with Financial Ombudsman Service (FOS) principles.
The de minimis threshold is being set lower than seen in some
redress cases reflecting the priority we attach to returning
funds to those affected while avoiding creating disproportionate
administrative burdens and disturbance in the cases of the
smallest holdings.
Contact will be made with estates through executors or personal
representatives. Beneficiaries will not be contacted directly
except where, as is often the case, beneficiaries are themselves
Executors or personal representatives. Where solicitors or
professional executors dealt with the administration of an estate
they will be contacted and it will be for them to contact
beneficiaries. All cases will be subject to proportionate tracing
checks to ensure payments are made safely and to the correct
party.
Remediation will be delivered in phases. NS&I will begin
contacting the first cohort next week, with payments made shortly
after contact. NS&I aims to return holdings to their rightful
owners as swiftly as possible and expects to have completed this
remediation programme in the first half of 2027.
I have committed to helping bereaved families avoid
disproportionate disruption and administrative costs that could
result from the inheritance tax consequences of rectifying
previous tracing errors. To achieve this I am confirming today
that there will be a full inheritance tax exemption for the
holdings of the remediation population affected by the NS&I
tracing error which are returned to the estates to which they
rightly belong. To further ease the administration of estates,
the personal representatives or executors will not be liable for
any Income Tax ordinarily due in their role on interest accrued
before death or in the administration period. HMRC is working
with NS&I to ensure that executors, personal representatives
and beneficiaries do not incur any unnecessary administrative
burdens or costs where tax is not due.
Beyond individual redress, NS&I has strengthened its
bereavement processes to ensure these tracing errors do not
reoccur. While this has driven an increase in processing times,
an additional 100 people have been hired to ensure this is
temporary. NS&I is also exploring broader improvements to the
bereavement journey, including alignment with cross‑government
services such as Tell us Once.
As I committed to the House, Sir , acting Chief Executive of NS&I is leading a wider
review into the background to the tracing problem and what
lessons must be learned. This will report before the summer
recess and be shared with the Chairs of the Treasury and Public
Accounts Committees. The Treasury has also started the process to
recruit a permanent Chief Executive.
Further information for anyone who believes they or loved ones
may have been affected is available on the NS&I website and
its contact centre is open seven days a week.
