I am appalled at the level of service given by my pension provider Aegon. I retired in March 2025 and wanted my pension fund moved to another provider’s drawdown pension.
I phoned Aegon and asked it to wait until my last contribution of £974.49 had been made before transferring the funds so it could all be done in one go.
It moved the funds without including my final payment which I later discovered was due to it having loads of people’s pension funds just sitting in an account due to a new system installed in August of the previous year.
After numerous phone calls from both my financial adviser and myself Aegon said I could raise an official complaint which I did in August 2025.
I then got replies just stating that it was very busy with complaints and had not been able to investigate.
It advised later on I could complain to the Pensions Ombudsman and the Financial Ombudsman which I did.
The Pensions Ombudsman said it would be able to look at it in 11 months’ time!
On 6 September I received a phone call from Aegon to advise that it had found my final missing contribution and would contact my drawdown provider to see how much my pension had gone up by to add this before transferring.
It would also decide an amount to compensate me for. At this point I thought it would all be resolved and asked it to confirm this all in writing, but no email was sent to me.
I cannot believe that a pension provider is allowed to treat its customers this way and the fact it is overwhelmed by complaints as is the Pensions Ombudsman is very worrying for myself and no doubt your readers.
I took this to the Financial Ombudsman in November and it agreed in my favour that Aegon should pay me compensation and the money owed plus the difference in the fund which I have lost out from by not being invested.
It’s now two months on from the Ombudsman decision and I’ve still not received a penny.
Steve Webb replies: It is clearly unacceptable that a transfer which should have been completed nearly a year ago was still outstanding when you contacted me at the end of January.
You have had to battle through a complaints process, both internally and via the Ombudsman system, which is not working as it should.
Several things strike me about your experiences, which may be of wider relevance to other readers.
The first is that you were told to use the company’s internal complaints process but were then told that there were so many complaints you would have to wait for a response. This hardly inspires confidence.
Whilst dealing with routine administration is not a glamorous part of the pension system, it is essential. I wrote about this recently for This is Money: Pension admin is too often done poorly or ‘on the cheap’ and it’s savers who lose out.
Whether in the processing of the initial transfer or the handling of your complaint, Aegon has clearly let you down.
Where you cannot get resolution via an internal complaint you were then referred on to the Ombudsman, but this part of the system is not working especially well either.
How do Ombudsmen deal with pension complaints?
There are two different Ombudsmen involved in pensions (and that doesn’t include the Parliamentary Ombudsman which deals with pensions issues relating to public sector bodies). These services are free to complainants.
First, there is the Financial Ombudsman Service.
On the FOS website it says: ‘We can look into most complaints about businesses that provide financial services – things like bank accounts, credit cards and loans, insurance policies, pensions, savings and investments. We can also look at complaints about Claims Management Companies.’
But, as you discovered, there is also a Pensions Ombudsman.
On its website TPO says: ‘Our primary function is handling pension complaints and disputes. We act impartially and our service is free.’
When you contacted TPO you were told that it could take nearly a year for your case to be looked at. Given that your complaint was about a delay, this is clearly quite unacceptable.
Although I know that a lot of work is going on to try to reduce this backlog, it has persisted for a long time. The Government needs to explain why the Pensions Ombudsman is not adequately resourced to handle the volume of (often complex) cases which it receives.
For those who are confused as to which Ombudsman to use, the company you are complaining against should tell you where you can complain if they reject your internal complaint.
But, as a rough guide, matters relating to occupational (trust-based) pensions are mostly dealt with by the Pensions Ombudsman whilst pensions provided by insurance companies (personal pensions) tend to be handled by the Financial Ombudsman.
By November you were still waiting. Fortunately, in your case, the Financial Ombudsman was able to look at your complaint, and ordered Aegon to resolve matters. But, as we entered the New Year, matters were still unresolved.
What about compensation?
In cases like this, there are normally two main types of compensation which you should receive, as well as resolving the original problem (the missed transfer in your case).
First, there is compensation for the actual loss suffered. If your final contribution had been transferred on time it would have enjoyed investment growth which you have missed out on. You should therefore be compensated for this.
Second, there is compensation for what is called ‘distress and inconvenience’. This is typically a modest amount to reflect the hassle you (and your adviser) have had to go through, chasing up your pension provider and then the Ombudsman to get things sorted out.
What does Aegon say?
I contacted Aegon on your behalf towards the end of January and I’m pleased to say that matters are finally resolved.
Aegon has, rightly, transferred your final contribution and made an additional payment to reflect the lost investment growth on your contribution. It has also paid a modest sum for ‘distress and inconvenience’, which you have accepted.
A spokesperson for Aegon said: ‘We apologise for the delays in concluding this transfer – this is not the level of service we would wish to provide or that our customers should expect.
‘A system issue resulted in the final contributions not being allocated to this account following the transfer request. Unfortunately the transfer went ahead before we had the opportunity to rectify this.
‘The transfer of the missing contributions has now been made, along with a payment of compensation.’
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