Personal Pension  

Now: Pensions faces late contribution issues

Now: Pensions faces late contribution issues

Now: Pensions has been unable to report late contributions for a year because of technical problems at the beginning of 2015.

The auto-enrolment provider is now going back through its records to report late payments to The Pensions Regulator.

According to TPR’s code of practice, trustees of DC occupational pension schemes must report a material payment failure to the regulator and members within a reasonable period.

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The problem stems from when Now: Pensions migrated around 400 companies it provided pensions for onto its new administration platform with JLT at the beginning of last year.

When this happened the company noticed some clients who were on its previous administration platform may have submitted contributions that did not match with their file data.

Because of this Now: Pensions stopped informing TPR of late payments so as to prevent their client companies from being fined because of their administration problems.

A spokesman for Now: Pensions said: “Due to delays processing contributions for some clients, largely as a result of our change of third party administrator last year, we were unable to report late contributions from clients in the way we would have liked.

“We couldn’t risk reporting a client for late payment of contributions, exposing them to a fine and regulatory action, when the delays could have been due to our systems upgrade.

“We have now implemented a process which has been approved by our auditors and will be applied retrospectively so that we will be reporting all issues, historic and future.”

The spokesman added that when the payment doesn’t match the contribution files or there is a query with an item of individual data the company cannot be certain to allocate the contribution correctly and had to return it to the client until the query was resolved.

Now: Pensions said it has been working with clients to get their contribution files up to date and has revised its operating model, including collection of contributions from employers by direct debit rather than by Bacs payment.

A spokesman for TPR confirmed the code of practice that sets out the requirements on pension providers to report contributions that are late.

“We gather intelligence about the market from a number of sources. In addition, employers and members who are concerned their contributions are not being processed can use our whistle blowing service and we will investigate,” it added, noting that this may lead to a case being opened.

“As a general principle, TPR does not comment about cases that may or may not be ongoing.”

Now: Pensions was launched in 2011 and is backed by ATP, the largest pension fund in Denmark which looks after more than 700bn Danish krone (£72bn) of assets for 4.9m members - more than 85 per cent of the Danish population.

It has been marketing itself as a low-cost auto-enrolment provider to rival government-backed Nest.