NS&I boss leaves Premium Bonds bank over missing savings scandal

The boss of state-backed savings giant NS&I has left the organisation after a £470m savings scandal.

Former HMRC boss Sir Jim Harra will replace Dax Harkins as the chief executive of NS&I on an interim basis to “provide a fresh start”, pensions minister Torsten Bell announced on Thursday.

It comes after it emerged that tens of thousands of customers had launched legal action against the Treasury-backed savings bank because it had apparently lost track of customers’ life savings.

The savings giant, which is responsible for Premium Bonds, is now launching programme to reunite people with their cash, with up to £476 million in deposits being affected.

Mr Bell told the Commons: “I also want to make sure NS&I has the very best leadership in place. Effective from today, I have appointed Sir Jim Harra, former HMRC first permanent secretary, to take over as the chief executive of NS&I on an interim basis, to provide a fresh start for NS&I’s next phase of development.

“I recognise his predecessor, Dax Harkins, 22 years’ of public service at NS&I.

“As well as providing leadership to the organisation, Sir Jim will undertake a review over the next three months to spell out in detail the background to this tracing problem and to set out what lessons must be learned for NS&I going forward.

“I have discussed this with Sir Jim and I’m confident that his extensive experience will help guide NS&I in the months ahead, and I will ensure Sir Jim’s review is shared with the chairs of the Treasury and the Public Accounts committees upon completion.”

Mr Bell said the causes of a tracing issue which affected NS&I customers has “been addressed and will not affect customers going forward”.

The pensions minister also told the Commons that “this issue is about tracing, not the security of any funds” held by NS&I, adding that “savings are 100 per cent safe”.

But he said NS&I did not respond fully to previous warning signs.

Concerns have been raised over bereaved families struggling to access their money.

Ms Bell said NS&I had notified the Treasury of an operational failure to trace accounts comprehensively of some customers who had died.

He said: “The result of this failure is that not all savings were identified by NS&I and paid to the beneficiaries of their estates as they should have been. Specifically, processes failed to comprehensively trace some customer holdings where those were spread across multiple profiles or systems.”

He added: “Bereaved families whose loved ones held accounts with NS&I will rightly be anxious about this news. Since being notified, the Treasury has ensured external advisers including EY and legal experts have been engaged to identify the scale of these errors.”

He said NS&I had reviewed over 34 million customer records and the work was still “ongoing, but it points to a maximum of around 37,500 customers with up to £476 million in deposits being affected.”

Three-quarters of cases relate to the period between 2008 and 2025, he added, and represents less than 0.2% of NS&I’s customers.

NS&I offers a range of savings and investments to more than 24 million customers, including more than 22 million Premium Bonds holders.

Mr Bell added: “The FCA (Financial Conduct Authority) took enforcement action in 2018 against Santander relating to the tracing of accounts following notification that a customer had passed on. This received significant attention at the time.

“However, what is now clear is that NS&I and its suppliers did not respond to those warning signs as fully as I and, more importantly, their customers would expect. Nor did the last government act. Bereaved families whose loved ones held accounts with NS&I will rightly be anxious about this news.”