Thousands of people will receive subsantial compensation after bereaved families struggled to access money that was rightfully theirs. Savings giant NS&I (National Savings and Investments) will reunite people with the lost savings following an operational failure to trace the accounts of customers after their deaths, pensions minister Torsten Bell said. Mr Bell told the House of Commons that NS&I notified the Treasury of the failure, which affected around 37,000 customers and up to £476 million in deposits.

He said the state-owned firm would “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”. “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,” he continued. “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.”

Mr Bell said around three quarters of the cases related to the period between 2008 and 2025.

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

It is backed by the Treasury, ensuring money held with it has 100% security.

Mr Bell said that while NS&I is not regulated by the Financial Conduct Authority (FCA), “the Government expects it to live up to the same standards as regulated deposit taking banks”.

He also told MPs that NS&I is responsible for reuniting beneficiaries with the money they are due, so “there is no need for individuals to waste money on a claims management company or solicitor”.

The pensions minister said the cases of the tracing issue had “been addressed and will not affect customers going forward”.

He also confirmed that former HM Revenue and Customs (HMRC) boss Sir Jim Harra will replace Dax Harkins as the chief executive of NS&I on an interim basis, for a “fresh start”.

“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,” he said.