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Resolving overdue contributions

General code in force: 28 March 2024

  1. When a payment failure is identified (see Monitoring contributions), the governing body should contact the employer quickly to resolve the overdue payment.
  2. Under section 249A of the Pensions Act 20041, governing bodies of certain schemes must establish and operate an effective system of governance (see Systems of governance) including internal controls (see Internal controls). However, there are certain exemptions2. The system of governance must be proportionate to the size, nature, scale, and complexity of the scheme activities.
  3. Under section 249B of the Pensions Act 20043, scheme managers of public service pension schemes4 are required to establish and operate internal controls, which are adequate for the purpose of securing that the scheme is administered and managed in accordance with the scheme rules5, and with the requirements of the law.
  4. Governing bodies should obtain overdue payments and rectify administrative errors in the most efficient way for their scheme. A typical process should cover the following steps:
    1. investigate any employer failure to pay contributions.
    2. Contact the employer promptly to resolve the overdue payment.
    3. Attempt to find out and record the cause and circumstances of the payment failure.
    4. Investigate any action the employer has taken as a result of the payment failure.
    5. Consider the wider implications or impact of the payment failure.
    6. Consider whether the failure is part of a pattern of a systemic failure.
    7. Seek to ensure that the employer resolves the payment failure.
    8. Where appropriate provide members with sufficient information to enable them to raise any issues with the employer.
    9. Take steps to make sure that a recurrence in the future is avoided.
  5. Governing bodies should maintain a record of their investigation and the communications between themselves and the employer. This will help them decide whether a payment failure must be reported to us and members6 (See Reporting payment failures)
  6. A monitoring process based on the information provided by employers may not be able to confirm deliberate underpayment or non-payment, or fraudulent behaviour by an employer. Governing bodies should review current processes to detect situations where fraud may be more likely to occur and where additional checks may be needed.

Glossary and legal references


Money due to be paid into the scheme. This may come from members in the form of regular or additional contributions, or from employers as regular or deficit-related contributions.


References to ‘days’ means all days. References to ‘working days’ do not include Saturdays, Sundays or bank holidays.

Material significance

Determines whether a breach of law should be reported to us, as determined by a number of factors, see Reporting payment failures.

Payment failure

A contribution which has not been paid in accordance with the payment schedule in full on or before its due date.

1Articles 226A of The Pensions (Northern Ireland) Order 2005

2Section 249A(3) of the Pensions Act 2004 (Article 226A (3) of The Pensions (Northern Ireland) Order 2005)

3Articles 226B of the Pensions (Northern Ireland) Order 2005

4As defined in section 318(1) of the Pensions Act 2004 (Article 2(2) of The Pensions (Northern Ireland) Order 2005)

5As defined in Section 318(2) of the Pensions Act 2004 (Article 2(3) of The Pensions (Northern Ireland) Order 2005)

6Section 88(1) of Pensions Act 1995 [Article 86(1) of Pensions (Northern Ireland) Order 1995] Section 111A the Pension Schemes Act 1993 [Article 107A of the Pensions (Northern Ireland) Schemes Act 1993] and Section 49(9) of the Pensions Act 1995 [Article 49(9) of Pensions (Northern Ireland) Order 1995] section 228 of the Pensions Act 2004 [and Article 207 of the Pensions (Northern Ireland) Order 2005]