Scottish Widows chief executive Toby Strauss has warned the pensions industry is close to breaking point in the wake of the Budget as the provider continues to struggle with customer service problems.
The insurer was criticised by industry insiders earlier this year, with sources saying it was taking up to 30 days, on average, to process pension transfer requests.
Scottish Widows retirement proposition director Stuart Paton Evans subsequently admitted the firm had experienced a fall in service standards following the Budget.
In a letter to The Telegraph, Scottish Widows chief executive Toby Strauss says: “Since I joined Scottish Widows in late 2011, we have dealt with the implementation of the retail distribution review, the roll-out of automatic enrolment, government caps on pension charges and the changes announced to annuities in the 2014 Budget. All of which give savers greater transparency, flexibility and choice.
“In the absence of any breathing space, we have concerns that the industry is in danger of reaching – and in fact breaching – its capacity to cope. Many of our own processes have struggled in the wake of the ongoing changes and as a result our service levels are in some areas falling short of the high standards our customers expect of us.
“I fully appreciate the impact that our service issues have had, and are having, on our customers and we are working hard and investing significant resources to ensure that we fix this as quickly as possible. Scottish Widows is investing tens of millions of pounds over the coming months and years to make us better placed to deal with this new world.
“This involves new customer service staff, upgrading IT systems and investing in training programmes. We are working with financial advisers, employers and the payroll industry, where we are also seeing capacity challenges.”