Questions Of Cash: 'Santander compensation over error was pitiful'

Q. I have banked with Abbey – now Santander – for over 14 years, but recently transferred to NatWest using a switching service which made contact with all my direct debits including, they claimed, for my Santander loans. But Santander wrote to me saying it had not received loan repayments. NatWest said it had written to Santander and received no reply. I contacted Santander's loans division to arrange to pay the outstanding balance on two loans and on the 21 December it took £223 and £292.97 from my account for loan repayments. Santander then took a further £2,992.97 from my account. As a consequence I received numerous warnings of failed direct debit payments and incurred costs, which Santander has eventually covered. But I had no funds available to me over Christmas to buy gifts or pay for travel. The funds were only repaid to my account on 5 January 2010 and even then the repayment was £292 short. I have been promised the other £292, but still not received it. JA, West Sussex.

A. Santander accepts it made "an administrative error". The £292.97 that you regard as a shortfall in the repayment was deliberately deducted as it represented the next loan repayment that had by then become due. Santander is willing to pay you £70 as compensation for its error. We have suggested to Santander that it should pay more given the scale of its error and the extent of your inconvenience, but it declines to increase the offer. If you believe it is inadequate you can take your case to the Financial Ombudsman.

Q. I received a letter from the NHS pension fund last July stating that my last NHS employer had notified them of a change to my total pensionable pay at retirement. This meant that my monthly pension was being reduced and that I had been over-paid on my lump sum and monthly pension amounting to a total of £1,141.21. It said it was obliged to recover the money. In August – when I was out of the country – it wrote again reminding me that I had not repaid the money. I have since received several more letters. I am not happy. None of this is my fault and I have not had an explanation of why this has happened. Am I legally bound to repay the money? Do I have to provide details of my income and outgoings? EA, by email.

A. Tom McPhail, the head of pensions research at advisers Hargreaves Lansdown, says: "The basic principle is that if a scheme inadvertently overpays a member, then it has a right – and arguably a duty as well – to reclaim the overpayment. If the scheme fails to recover the overpayment then the loss will have to be made up elsewhere, perhaps by additional funding from the employer. You have a couple of options open to you. You can write back to the scheme administrators setting out the reasons why you feel that you should not have to repay the money, or you can ask for help in negotiating with them from the Pensions Advisory Service, a DWP-funded public resource set-up to assist pension scheme members. If you don't achieve a satisfactory resolution you can also submit a complaint to the Pensions Ombudsman. However, they will only take on your case if you have made all reasonable attempts to resolve it elsewhere first. As for the information about your income and outgoings, that is being asked for to determine a suitable rate of repayment. You don't have to supply the information: however, it may be a good idea to do so if you want to try and secure a sympathetic repayment schedule."

Q. My wife and I read your column on 6 February with alarm as we have around £50,000 each deposited in Alliance & Leicester Online Saver 6 accounts, which we understand give 3 per cent as an introductory rate of interest including bonus, with variable underlying base rates depending on the amount deposited. The A&L leaflet dated 11 September clearly states a maximum deposit of £2m. So we are puzzled to read your correspondent MG of London's claim of interest being limited to the first £25,000 of his £75,000 investment in an A&L online saver account. We have checked this with Alliance & Leicester, whose operative says she knows of no such limit on current or previous issues of online saver accounts. Was MG's investment on some other online savings account? RP, Carlisle.

A. Reader MG of London was invested in an early version of the Alliance & Leicester account, the Online Saver 2. Your investment is in the Online Saver 6, which is not subject to the same conditions limiting the sum on which interest is earned.

Q. I was unable to travel by Ryanair when my wife fell ill. I tried to recover the taxes on the flight, but Ryanair declines to repay them saying the administration charge to do so is greater than the taxes charged. MB, by email.

A. Ryanair says it is unable to comment on your specific circumstances without your flight booking number. Our requests to you for this information have been ignored. Ryanair has directed us to the conditions on its website. These state: "All Ryanair fares are fully changeable in respect of flight/dates/times/routes and names (up to four hours prior to original flight departure) however fares, fees and/or charges are non-refundable. Government taxes are the only element of taxes, fees and charges which are refundable. Government tax refunds are subject to a reasonable administration fee. If the refund amount is less than the applicable refund administration charge then no refund will be made. Government tax refund requests must be made within one month from the booked travel date."

Questions of Cash cannot give individual advice. But if you have a financialdilemma, we'll do our best to help. Please email us at: questionsofcash@independent.co.uk