NS&I boss resigns after up to 37,500 customers were left unable to access £470m-worth of relatives' premium bonds

The boss of National Savings and Investments has resigned after a scandal saw up to 37,500 customers left unable to access their relatives' premium bonds. 

Dax Harkins, who has served as chief executive of NS&I since April 2023, left the company this morning after a meeting with Treasury officials, it is understood. 

Mr Harkins reportedly took home more than £300,000 a year in salary and pension perks during his time as chief executive.  

He has left after it emerged the bank planned to repay tens of thousands of savers whose money was withheld from them due to a series of failures. 

NS&I estimates that up to 37,500 bereavement claims with a total value of up to £476million in customer deposits may have been affected. 

The company is accused of short-changing families by losing track of investments, delaying payouts and withholding premium bond prizes. 

Some customers were reportedly forced to turn to lawyers to help recover the money they were owed by NS&I, incurring additional costs. The Treasury is understood to be working with the bank to establish the precise sum of compensation for affected customers. 

Former HMRC boss Sir Jim Harra will replace Mr Harkins as chief executive on an interim basis to 'provide a fresh start', pensions minister Torsten Bell announced today. 

He 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.' 

He added: '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.'

Shadow Treasury minister Mark Garnier accused the Government of 'sitting on their hands' over the 'poor performance' of NS&I.

Speaking in the House of Commons today, he said: 'Why has this Government been sitting on their hands?

'The poor performance and a botched digital transformation means that the NS&I are short-changing savers at a time when raising money for the Government has never been more needed.'

Mr Garnier added it was 'concerning' that the Treasury were notified of the operational failures on December 18, but only made a statement to Parliament after an article in the The Daily Telegraph three months later.

He asked: 'Can the minister please explain why it has taken him over three months to come forward with this statement?

'People have been let down. Whilst NS&I have apologised for these mistakes, this will be of little comfort to those thousands of people who have lost out. The Government does need to act swiftly and the families need to be compensated.'

NS&I did not respond fully to previous warning signs, pensions minister Mr Bell, who also sits in the Treasury, told the Commons.

He said in a statement: '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.'

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

He added that 'this issue is about tracing, not the security of any funds' held by NS&I, insisting that 'savings are 100 per cent safe'.

NS&I is responsible for reuniting beneficiaries with the money they are due, the pensions minister told MPs, adding 'there is no need for individuals to waste money on a claims management company or solicitor'.

Mr Bell told the Commons: 'NS&I has put in place a dedicated programme team and it's hired an additional 100 staff.

'I have asked them to publish a delivery plan in May detailing how they will take forward this work to reunite funds with their owners.

'This will cover the number of cases affected, how NS&I will proactively contact representatives of estates to ensure they receive the funds they are due, including interest on savings, and the compensation that, where appropriate, will be paid.

'There is no need for individuals to waste money on a claims management company or solicitor.

'I want to reassure people that the onus is not on them but on NS&I to act, to contact estate representatives and to reconnect beneficiaries with the money they are due.'