Two in five NS&I savers gave up when they tried to telephone customer services late last year as waiting times spiked during the pandemic
- Three members of the Treasury-backed bank’s top brass were grilled by MPs
- It follows a 2020 which saw complaints and call waiting times spike
- Some 6,700 complaints are still outstanding but will be cleared by the summer
- Chief executive Ian Ackerley defended its decision to hold rates last spring while other banks cut theirs
Two in five savers who tried to telephone National Savings & Investments late last year gave up because they couldn’t get through, the bank’s top brass admitted to MPs.
Chief operating officer Matt Smith provided the eye-catching figure to Tory MP Harriet Baldwin during a hearing that saw three of NS&I’s most senior employees grilled over the beleaguered Treasury-backed bank’s performance last year.
NS&I’s decision to maintain its rates at best buy levels during the pandemic only to cut them in November and phase out Premium Bond prize cheques saw waiting times on the phone spike and customer complaints rise 43 per cent in the six months to the end of September 2020.
The call abandonment rate among NS&I customers spiked to 40% last September from 5% normally as the bank struggled to cope with those trying to withdraw money after it cut rates
But its chiefs admitted to MPs that 40 per cent of savers who tried to get through on the phone in September, October and November gave up because of the long waiting times, compared to a call abandonment rate of just 5 per cent in normal times.
Chief executive Ian Ackerley said: ‘What we saw was a level and pattern of call volumes we hadn’t predicted and expected.
‘Quite a higher percentage of savers immediately left when the rate reductions were announced in September even though we gave two months’ notice, and that created a spike.
‘At the same time we were implementing the Premium Bond changes and that created a bigger spike than we were expected.
‘There were both sides of this, we weren’t getting the resources that we hoped to get in to handle it and the spikes turned out to be bigger and of a different type than we expected.’
NS&I in December admitted it was the wrong decision to try and implement the phasing out of paper warrants while its customer services were under strain and has delayed doing so until this spring.
The move attracted the ire of some of NS&I’s older customers who wished to continue receiving their prizes by post.
Waiting times on the phone rose to an average of around 20 minutes in October, with some savers having to wait almost an hour to get through.
Mr Ackerley said waiting times had now fallen to around 45 seconds after it hired 350 new customer service employees, and the abandonment rate to ‘below 10 per cent even though call volumes are still high.’
Chief executive Ian Ackerley was one of 3 senior employees of the bank grilled by MPs
He said the Treasury-backed bank is still sitting on a backlog of around 6,700 complaints which would take ‘several months to clear’ but it would do so ‘by the summer.’
He added: ‘We faced a perfect storm in staffing, people were isolating or ill, our facilities in India were closed and we had to reduce capacity of operational centres in the UK’, which saw the number of complaints it could handle a week fall to 400.
This figure has since risen to 1,200, Mr Ackerley said.
The chief executive, Mr Smith and NS&I’s finance director, Ruth Curry, were also quizzed over their decision to hold savings rates at best buy levels, which saw billions of pounds poured into the bank, before it cut them to as little as 0.01 per cent in November.
Some £13billion was withdrawn from NS&I between October and January after the cuts were announced in September, with the bank expected to undershoot its £35billion fundraising target for 2020-21 as a result.
The decision to reverse NS&I’s planned cuts was signed off by the Treasury and made by Treasury minister John Glen, the Treasury Select Committee was told.
‘The decision was taken we wouldn’t reduce rates, that was the decision the minister made’, Mr Ackerley said.
‘We attracted a cohort of customers we normally wouldn’t see, they came in very fast, the inflow of funds was because of league tables, because of the media, that brings a different set of people to what we normally see.’
Most of those newcomers, attracted by the best buy rates, will likely be those who have withdrawn money since the cuts were announced last September.
But despite its actions being heavily criticised, Mr Ackerley defended the move.
‘We didn’t put our rates up, we were just top of the tables because other providers cut theirs. We stood by the savers, and we kept our rates.’