Pension admin is too often done poorly or ‘on the cheap’ and it’s savers who lose out, says STEVE WEBB

Sir Steve Webb is celebrating ten years as our retirement columnist, says This is Money publisher Simon Lambert

A former pensions minister, Steve has spent the past decade answering This is Money readers’ questions each week. Over that time, he has done a huge amount to boost financial education on pensions and the retirement prospects of our readers.

He has also played a vitally important campaigning role, alongside our pension and investing editor Tanya Jefferies, exposing problems and getting them fixed.

We are immensely proud of the part Steve plays in the This is Money team. Here’s what he has to say about the experience of writing his column over the past ten years.

When we think about people getting a raw deal when it comes to pensions, it’s tempting to think about crooks and scammers, writes Steve Webb.

But, after 10 years of responding to queries from readers of This is Money, I’ve realised that something much more mundane lies behind many of the problems that we have resolved.

Readers of This is Money act as an ‘early warning system’, telling us as soon as things go wrong so that we can work on their behalf to get things sorted

It’s the simple matter of pensions administration.

If you need a widow’s pension after your husband has died, or you want a pension quote so you can decide when to retire, or you need a pension value as part of a divorce case, what you need in each case is efficient administration.

Although you may be one of millions of members of a pension scheme, you still need a system which treats you like a human being and deals with your issues quickly and efficiently.

But all too often this is not the case. Too often, administration is done poorly, or ‘on the cheap’, and it is pension scheme members who lose out.

And it is readers of This is Money who act as an ‘early warning system’ telling us as soon as things go wrong, so that we can work on their behalf to get things sorted.

For example, back in 2020, a reader told me that his wife had spent many years on an underpaid state pension. 

This triggered a huge reader response and our pressure eventually led the Government to set up a four-year-long correction exercise involving over 1,000 civil servants working to put things right.

To date over £800m in arrears has been paid out to over 130,000 people, all because the administration of the system didn’t work in the first place.

Or think of the latest administration scandal where civil servants are facing chaos, with people kept on hold on phone lines for hours before being cut off, or finding it impossible to get a response to their pension questions.

This is Money’s tireless pensions editor, Tanya Jefferies, went in person last week to Westminster to challenge Capita bosses who were supposed to be sorting out the mess left by the previous administrators. 

As a sticking plaster, the Government has had to put in place interest free loans to prevent hardship as well as lending 150 government staff to go and help deal with the backlog.

All of this could have been avoided if the quality of administration had been taken seriously rather than the constant pressure to do things as cheaply as possible.

In writing my weekly column, I have also spent a lot of time helping readers who have got lost in the gaps between different Government departments, with each saying that the other was responsible for sorting out the issue.

A classic example of this was the farce over top-ups to people’s National Insurance records, where the whole system collapsed under an avalanche of people trying to top up before a deadline, which then had to be extended twice.

Poor administration also leads to another problem I deal with on a regular basis – helping people to track down lost pensions.

I’ve lost count of the number of people who have told me that they worked for a company but now there seems to be no sign of their pension.

Often it turns out that records were incomplete or out of date, and we are able to reunite the reader with their lost pension pot. 

But it would be far better if more effort went in to getting the records right in the first place.

Administering pensions is never going to be glamorous work, and I am grateful to the many thousands of people who take pride in doing a good job.

But skimping on administration costs more in the long run, and creates misery for many thousands of people. 

It’s time this vital aspect of the pensions landscape was given the attention that it deserves.

> Read all of Steve Webb’s pension questions and replies

Ask Steve Webb a pension question

Former Pensions Minister Steve Webb is This Is Money’s Agony Uncle.

He is ready to answer your questions, whether you are still saving, in the process of stopping work, or juggling your finances in retirement.

Steve left the Department of Work and Pensions after the May 2015 election. He is now a partner at actuary and consulting firm Lane Clark & Peacock.

If you would like to ask Steve a question about pensions, please email him at pensionquestions@thisismoney.co.uk.

Steve will do his best to reply to your message in a forthcoming column, but he won’t be able to answer everyone or correspond privately with readers. Nothing in his replies constitutes regulated financial advice. Published questions are sometimes edited for brevity or other reasons.

Please include a daytime contact number with your message – this will be kept confidential and not used for marketing purposes.

If Steve is unable to answer your question, you can also contact MoneyHelper, a Government-backed organisation which gives free assistance on pensions to the public. It can be found here and its number is 0800 011 3797.

Steve receives many questions about state pension forecasts and COPE ¿ the Contracted Out Pension Equivalent. If you are writing to Steve on this topic, he responds to a typical reader question here. It includes links to Steve’s several earlier columns about state pension forecasts and contracting out, which might be helpful.  

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