Committee of Public Accounts

Press Notice No. 36 of Session 2002-03, dated 17 July 2003


Mr Edward Leigh MP, Chairman of the Committee of Public Accounts, today urged the Department for Work and Pensions, following problems encountered with the changes to Inherited SERPS, to improve the quality of its customer records to help it to communicate better with the public.

Mr Leigh was speaking as the Committee published its 36th Report of this Session, which examined the action taken by the Department for Work and Pensions in response to recommendations made previously by the Committee on tackling the Inherited SERPS problem itself, and on the proposals for remedying it. This Report follows the Committee's 2000 Report on the failure by the then Department of Social Security to inform the public about a change in inheritance arrangements for the State Earnings-Related Pension Scheme (SERPS). The Government postponed the change, at an estimated cost of £12 billion by 2050. The new Social Security (Inherited SERPS) Regulations came into force in October 2002.

The Committee found that the Department invested considerable resources in publicising the changes to the inheritance arrangements for SERPS to more than 20 million people before the Regulations came into effect in October 2002. This was a major undertaking, but many of those affected were not advised until less than six months before the Regulations were due to come into force, limiting the amount of time available to some to make alternative financial provision.

The need to contact millions of people demonstrated that the quality of the address records held by the Department remains poor, both for those resident in the United Kingdom and abroad. There is no legal requirement for people who do not claim benefits to inform the Department of their address, yet having accurate customer records is essential if the Department is to inform customers about developments which affect them or to communicate messages effectively. As well as data matching already under way, the Committee said the Department should work to improve systematically the quality of the address records it holds, for example through advertising the importance of ensuring address records are kept up to date, using web-sites accessed by customers living overseas to encourage them to update their address records, and encouraging customers to notify the Department of their e-mail address.

The Department has used the Committee's previous recommendations on the Inherited SERPS problem as the basis for introducing a number of important changes in the organisation of the Department, and in the way staff deal with customers. These include more systematic quality assurance arrangements for ensuring leaflets are accurate and routine checking of the adequacy of oral and written communications with the public. This good practice now needs to be extended quickly throughout the Department.

Mr Leigh said today:

"Since my Committee raised concerns about the failure to properly inform the public of a change in inheritance arrangements for SERPS in 2000, the Department for Work and Pensions has invested considerable resources in getting its message across. Over 20 million people have received letters or been targeted with advertising about the change. But many have had limited time to make alternative financial provisions and the Department decided not to alert people routinely that compensation might be available. This demonstrates that the Department could do a lot more to improve the effectiveness of its communications with the public."

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