Complaints relating to pensions have jumped by 10% since March 2008, with nearly 8,000 disputes referred to The Pensions Advisory Service (TPAS) over the 12 month period.
Delays in paying pension benefits and mistakes leading to financial losses were two of the main reasons for the rise in complaints, with poor administration the biggest cause of the increase. TPAS, a government-funded body, says that the majority of complaints were made by people with individual pension plans, with the number of grievances relating to occupational schemes actually falling by 2%.
The credit crunch has been blamed for the increase in pension problems. “Many savers had experienced significant reductions in the value of their pension savings from continuing stockmarket falls and delays in obtaining an annuity quote or award often meant a further reduction in the pension eventually secured,” explains Malcolm McLean, chief executive of TPAS.
Ironically, many complainants also suffered delays in getting a response to their original gripe from their pension providers.
TPAS received 75,000 calls and 12,500 written during the 12 months to March 2009, with 44% of calls and 25% of letters relating to the state pension.
There were also a “significant” number of concerns from people with self invested personal pension (SIPP) plans, some of whom were confused about the product and the level of personal responsibility they had taken on. TPAS says this could indicate deeper issues with the way people are sold this type of pension plan.
Another concerning aspect of the TPAS’ annual report was the increase in people complaining about the non-payment of employer pension contributions, with enquiries doubling to 42 a month during the year.
Tom McPhail, head of pension research at Hargreaves Lansdown, says there are strict guidelines that dictate the timescale for employers to pay pension contributions.
"If this happens to you, then you should raise the issue with your employer," he adds. "If you aren't happy with the response you get, then contact the Pensions Regulator."