791 INDEX
SUPERANNUATION ACT 1972
LOCAL GOVERNMENT PENSION SCHEME REGULATIONS 1997 (the 1997 regulations)
1) I refer to your letter of 30 April 2000 in which you appeal (under regulation 102 of the 1997 regulations) to the Secretary of State for the Environment, Transport and the Regions against the decision of Mr XXX, the Appointed Person for XXX Council (the council), in relation to your Local Government Pension Scheme (LGPS) dispute with the council.
2) The Appointed Person found “ …in exercising their [the council’s] discretion under the LGPS Regulations to award you 6 2/3 years they have granted you the maximum possible service … I feel that XXX’s decision not to employ the provisions in the Discretionary Payments Regulations to be a reasonable exercise of discretion primarily … no cost to XXX. … you feel you have a protected right to the award of 10 added years … My view is that these terms and conditions applied specifically to the severance scheme for employees made redundant on the abolition of the County Council in 1986. I do not agree that those terms applied to employees, such as yourself, … In any event if those conditions applied to all employees I am not satisfied that … could …place a requirement on them to exercise discretionary powers … in a certain manner. Finally … you were consistently offered the alternative of continued employment … After you were notified of the revised award of 6 2/3 additional years service rather than 10 … you still opted to take those retirement benefits …you did make that decision to retire in the knowledge that you were going to be awarded only 6 2/3 additional years service.”.
3) The Secretary of State’s powers under regulations 102 and 103 of the 1997 regulations are to reconsider the original disagreement referred to the Appointed Person under regulation 100. This regulation refers to a matter relating to the LGPS, which effectively means whether the statutory provisions governing the LGPS have been properly implemented. The Secretary of State has no powers to award compensation even where it is shown that maladministration has taken place leading to financial loss or injustice.
4) In your application to the Appointed Person you raised a number of issues including :-
a) the council’s failure to use money available from the Department of the Environment, Transport and the Regions (the Department) to fund the original pension figure;
b) that you were treated abominably; and
c) the Department or the council wanted to abrogate any long term responsibility for your pension/welfare.
The Secretary of State has no powers to consider such questions on a pension appeal as they are not matters which fall to be determined under the rules governing the LGPS.
5) You also raised a question about being awarded 10 years additional service. There are no provisions in the LGPS to award a period of more than 6 2/3 years. However, the Local Government (Discretionary Payments) Regulations 1996 allowed local authorities the discretion to award a credited period. Such an award would have been made under regulation 8 with a maximum of 10 years being permitted (although this was dependent on a number of factors and in many cases the maximum permitted award would be less) where an employee is made redundant. Such an award is not funded from the LGPS fund. Whether a local authority made such an award was at their discretion, as was the level although they could not award a level higher than the maximum permitted in the individual circumstances. These regulations contain no appeal provision. Decisions about which powers to use are for local authorities as employers and are not matters the Secretary of State can look at on appeal.
6) The questions for decision: The questions that the Secretary of State can consider are whether:
a) you have been award the maximum enhancement allowed under the 1997 regulations;
b) you are entitled to receive the amount quoted in the estimate dated 8 July 1999 or the letter dated 23 September 1999; and
c) the council should have provided a competent person to aid and assist you on pension matters.
7) The Secretary of State has considered all the representations and evidence. Copies of documents supplied by the Appointed Person were sent to you under cover of the Department’s letter of 9 June 2000.
8) The Secretary of State’s decision: The Secretary of State has taken into account the appropriate regulations. He finds that:
a) the council decided to use the discretionary powers available in the 1997 regulations and awarded you the maximum enhancement allowed of 6 2/3 years (regulation 52). He concludes that there is no evidence to show that they have acted unreasonably or improperly under these regulations;
b) he finds that the estimate dated 8 July 1999 was based on your LGPS membership and an award of 10 additional years. However, you based your decision to accept redundancy in the knowledge that you would not receive 10 additional years but 6 2/3 years. The Secretary of State does not consider maladministration has been shown to have occurred as a result of this estimate being given as at the time you based you decision to accept redundancy you were aware that you would be awarded an enhancement of 6 2/3 years not 10 years.
c) that in a letter to you from the council dated 23 September 1999 you were given provisional estimated figures that your annual pension would be £8,404.52, with a lump sum of £25,213.58 but your actual benefits are £8,282.84 annual pension and a lump sum of £24,845.51. It appears that the council informed you that this was as a result of a mistake. Like the Appointed Person the Secretary of State cannot direct the council to act other than in accordance with the regulations. The Secretary of State has no power to order redress that would conflict with the requirements of the regulations, or to award compensation, in any case, even where maladministration is shown to have led to financial loss or injustice;
d) he finds that there are no provisions in the rules governing the LGPS which require the council to provide aid and assistance to a member, although there are requirements to provide certain information. The Secretary of State would expect the council to be as helpful as it reasonably could in explaining the provisions, but they could not provide advice about, for example, the best course of action for an individual member to take.
The Secretary of State dismisses your appeal.
9) The Secretary of State’s decision confirms the Appointed Person’s decision in relation to the award made to you under the 1997 regulations. He takes the view that the Appointed Person had no formal powers under regulation 100 of the 1997 regulations to consider disagreements in relation to the 1996 regulations. However, the Secretary of State considers it good practice that where there is such a disagreement the council provides a means to review it independently by someone who was not involved in the original decision. It is noted that in this case the Appointed Person for the council has considered the matter and given a detailed reply. The Secretary of State’s powers in regulations 102 and 103 of the 1997 regulations do not apply to this part of your disagreement and he cannot therefore confirm or replace the decision reached by the Appointed Person.
10) The Secretary of State is acting judicially and has no power to modify the way the regulations apply to the facts of the case. Having made his decision he has no power to alter it and his officials cannot discuss the case further. The decision is binding and can only be overturned by a judgement of the High Court or the Pensions Ombudsman.
11) This completes the second stage of the internal dispute resolution procedure. The Pensions Advisory Service (OPAS) is available to assist members and beneficiaries in connection with difficulties which they have failed to resolve. Their address is 11 Belgrave Road, London, SW1V 1RB (telephone number 0207 233 8080).
12) The Pensions Ombudsman may investigate and determine any allegation of maladministration or any complaint or dispute of fact or law in relation to the LGPS made or referred in accordance with the Pension Schemes Act 1993. His address is 11 Belgrave Road, London, SW1V 1RB (telephone 0207 834 9144).