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Page last updated at 17:45 GMT, Friday, 3 April 2009 18:45 UK

State pension deadline extended

By Paul Lewis
BBC Radio 4's Money Box

A man sitting at a computer typing
The online service failed to cope with "unprecedented demand"

A deadline to pay missing National Insurance contributions has been extended after the number of enquiries overloaded government computers.

There was a tenfold increase in callers to the Pension Service before the cost of filling the gaps rises by 50%.

They were asking for a pension forecast to see if paying extra now would boost their state pension.

But the system collapsed and the Pension Service has now apologised and promised to accept late claims.

Its chief executive, Terry Moran, told BBC Radio 4's Money Box: "Let me apologise to customers who had difficulties getting forecasts. We faced an unprecedented level of demand.

"This last two weeks we've seen interest in obtaining a pension forecast rise from the five to six thousand that we would normally expect in a month to something like 50,000."

As a result both the online forecasting service and the telephone helpline have been running slow and at times people could not get through at all.

Money Box listener Will Haines told the programme his experience of the online service: "I went to try it on Saturday only to find the system down until Monday.

"That is worrying because getting a forecast is just the first step. You need to review it and then purchase the extra years.

"I tried accessing the system Monday, Tuesday and Wednesday morning at 3.30am."

Period of grace

The cost of buying a year's contributions rises by around £200 from 6 April.

But Mr Moran said the Pension Service has now agreed a month's period of grace with HM Revenue & Customs which collects the contributions.

"If a customer has tried to get through but has been unable to do so, if they act within one month of receiving the forecast, Revenue will ensure that the National Insurance contributions will be charged at the lower level, not at the post April 6 level," he said.

He added that if people fell outside this guideline but felt the system had caused them any problem which meant they had been disadvantaged, their case would be considered sympathetically.

"If they have acted to obtain their forecast before 6 April we will look at those on a case-by-case basis," he said.

But he denied that the Pension Service had failed to foresee a rise in the enquiries in the weeks before the price rise.

"It is predictable that there was more interest but the level of interest was unpredictable," he said.

BBC Radio 4's Money Box will be broadcast on Saturday, 4 April 2009 at 1204 BST.



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SEE ALSO
Demand overwhelms pension website
31 Mar 09 |  Business
Q&A: Basic state pension
26 Oct 10 |  Business

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