494      INDEX

LOCAL GOVERNMENT PENSION APPEAL

 

SUPPERANNUATION ACT 1972

LOCAL GOVERNMENT PENSION SCHEME REGULATIONS 1995 (the 1995 regulations)

LOCAL GOVERNMENT PENSION SCHEME REGULATIONS 1997 (the 1997 regulations)

 

1.                  I refer to your letter of 21 August 1998 in which you appeal under regulation 102 of the 1997 regulations on behalf of XXX Council (the council) to the Secretary of State for the Environment, Transport and the Regions against the decision of Mr XXX, the Appointed Person.  The Appointed Person revoked the decision of the council that XXX did not qualify for early retirement on ill-health grounds when his employment with the council ceased on 31 March 1998.

2.                  You appeal on the grounds that although Mr XXX no longer works for the council he is doing the same duties.  Having ceased employment with the council on 31 March 1998 he has been working from 1 April 1998 for XXX, a non local government pension scheme (LGPS) employer, who provide services to the council under contract.

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.  Mr XXX appealed to the Appointed Person on 23 February 1998 against the council’s decision not to retire him on ill-health grounds.  Regulation 100 refers to a matter relating to the LGPS, which effectively means whether the LGPS regulations have been correctly applied in the circumstances.

4.                  The question for decision: The question for decision by the Secretary of State is, therefore, whether Mr XXX was entitled to immediate payment of his pension benefits on ill-health grounds when he ceased employment with the council.

5.                  The Secretary of State has considered all the representations and evidence.  Copies of all documents supplied by the Appointed Person and Mr XXX have been sent to you under cover of the department’s letters of 2 October and 17 November 1998.

 

6.                  Secretary of State’s decision: Having taken into account the appropriate regulations, the Secretary of State has decided that Mr XXX was not entitled to immediate payment of retirement benefits on grounds of ill-health when his employment with the council ceased on 31 March 1998.  His decision replaces the Appointed Person’s decision.  The following paragraphs explain why.

 

7.                  On 23 February 1998 when Mr XXX lodged his appeal with the Appointed Person, and on 31 March 1998 when his employment with the council ceased, the 1995 regulations applied.  The regulation dealing with early entitlement to retirement benefits on grounds of ill-health was regulation D7.  This says that where a member of the LGPS ceases to hold a local government employment by reason of being permanently incapable of discharging efficiently the duties of that employment by reason of ill-health or infirmity of mind or body, his LGPS retirement benefits are payable immediately.  These benefits will be enhanced where the member has more than five years’ membership.

8.                  The provisions of regulations D7 of the 1995 regulations are concerned with members’ entitlements when their employment ceases.  The Secretary of State has no power under the 1997 regulations to consider whether employment should cease and if so the reasons why; that is an employment decision rather than a pension one.  Once an employee has ceased employment with a local authority the Secretary of State, following an Appointed Person’s decision, may consider an appeal about whether an ill-health pension and grant are payable under regulation D7.  In doing so he will take into account whether there is evidence which indicates that employment ceased because the member was permanently incapable of discharging efficiently the duties of that employment by reason of ill-health or infirmity of mind or body.

 

9.                  When Mr XXX lodged his appeal, he was still employed by the council.  Since his employment had not at that stage ceased, he was not then entitled to payment of retirement benefits.  When he did cease his local government employment, on 31 March 1998, he was transferred to XXX, and the Secretary of State notes that he returned from sick leave and took up his employment with them the following day.   The Secretary of State notes that Mr XXX and the council disagree about the extent to which Mr XXX’s duties with XXX were the same as those he had undertaken with the council.  The Secretary of State cannot resolve this, but he is satisfied that Mr XXX was transferred, and his employment with the council terminated, because some of the council’s functions on which he was engaged were outsourced to XXX.  Mr XXX did not therefore cease his local authority employment by reason of permanent ill-health, but because of a transfer of functions.  He does not therefore qualify for immediate payment of benefits on ill-health grounds under the terms of regulation D7.  The Secretary of State therefore upholds the Council’s appeal.

 

10.              It is not a matter for the Secretary of State to consider whether the council acted reasonably in proceeding to transfer Mr XXX to XXX while he was on sick leave and the question whether he should be given ill-health retirement was under review.  Nor is it for the Secretary of State to consider, within the context of this appeal, whether, since ceasing his employment with the Council, Mr XXX qualifies for the early release of his unenhanced retirement benefits under regulation 31(6) of the 1997 regulations.  That would be a matter for Mr XXX to take up with the council, if appropriate, in the first instance.

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 0171 233 8080).

12.              The Pensions Ombudsman may investigate and determine any complaint or dispute of fact or law in relation to the LGPS made or referred in accordance with the Pensions Schemes Act 1993.  His address is 11, Belgrave Road, London, SW1V 1RB (telephone number 0171 834 9144).