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By silicon.com, 19 May 2003 17:18

NEWS An inquiry has been launched into the fiasco that led to 10 million people facing shortfalls in their state pensions. The Inland Revenue came under fire last week after it was revealed millions of low-paid workers had not been informed for five years that their national insurance contributions were up to £1,500 short. The Revenue said it made a decision to stop sending out the top-up notices in 1997 because resources were tied up in dealing with “serious” problems with the rollout of the new National Insurance Recording System (Nirs2). Paymaster General Dawn Primarolo told MPs on Friday that the decision was intended to be a temporary measure. “I have been informed that the Contributions Agency took the decision to suspend issuing deficiency notices as a result of the serious problems they were experiencing in the introduction of the NIRS2 computer system, dating back to 1996. “It was intended to be a temporary measure to clear the backlog of work created by these problems but no plan was ever put in place to resume issuing them.” Primarolo has now ordered an inquiry to report by the end of the month why ministers were not consulted or informed of the decision and why the issuing of top-up notices was not resumed after the National Insurance Recording System (Nirs2) was made stable. In the meantime the Revenue has said it will issue notices to those affected. They will be given as much time to pay as they would have had if the notices had been issued in the normal way. A spokesperson for Accenture, which was responsible for the implementation of the Nirs2 system, said it was the Revenue’s responsibility to send out the top-up notices and maintained the system is now robust and fully operational. “To delay issuing these reminders was a business decision by the Inland Revenue. There has not been a 'computer error' with the National Insurance Recording System. The system has been up and running for several years and is fully functional."