Our Ref:  LG R 79/1/1636                283    INDEX

DATE:          February 1998

 

SUPERANNUATION ACT 1972

LOCAL GOVERNMENT SUPERANNUATION REGULATIONS 1986 (“the 1986 regulations”)

LOCAL GOVERNMENT PENSION SCHEME REGULATIONS 1995 (“the 1995 regulations”)

 

1.   I am directed by the Secretary of State for the Environment, Transport and the Regions to refer to your notice of appeal under regulation J5 of the 1995 regulations against the decision of the XXX Pension Fund ("the  FUND") on your pension position.

 

2.   The appeal has been conducted by correspondence. Consideration has been given to your  letters of 5 August 1995, 26 February and 29 October 1996, 29 April and 14 October 1997; to the   FUND’s letters of 5 December 1996 and  25 March 1997 and documents received on 20 January 1998; and to all copy documents submitted therewith.

 

3.   The question for determination is whether your pensionable benefits from the Teachers Superannuation Scheme (“TSS”) should have been transferred to the Local Government Superannuation Scheme (“LGSS”).

 

4.   From the evidence submitted the following facts have been established:

 

a) from 1976 you were employed as a teacher in various local authorities;

 

b) on 14 December 1987, you took up pensionable employment with the City of XXX;

 

c) on 15 March 1988, you signed a form requesting information about transferring your TSS pension to the LGSS;

 

d) on 30 November 1988, the  FUND received details of a cash equivalent transfer from the Department of Education and Science;

 

e) you did not subsequently complete an option form and the transfer was not preceded with;

 

f) on 1 October 1990, you commenced employment with the XXX City Council  (“XCC”), however you did not actually start work until after your adoption leave finished in April 1991;

 

g) on 4 February 1991, the  FUND wrote to you at your home address, reminding you that you had not completed an option form and setting a time limit for its return; 

 

h) on leaving XCC employment on 6 February 1994 your LGSS pension was preserved;

 

i) in 1995 you enquired with the  FUND about transferring your preserved pension from the TSS into the LGSS;

 

j) in 1995 you appealed against the  FUND’s decision not to accept a transfer.

 

5.       The  FUND contend that they sent you details of your TSS service credit with an option form on 31 January 1989 and subsequent reminders but as they did not receive any reply from you, the transfer request was cancelled on 9 April 1991. They further contend that they cannot accept a transfer as you are no longer a contributor to the Local Government Pension Scheme (“the LGPS”) and furthermore the DES (now DFE) are not prepared to pay a transfer value.

 

6.       You contend that you never received any communication from the  FUND about the transfer except for their letter of 4 February 1991, which arrived at a time of domestic upheaval. You contend that by then you assumed the transfer had gone ahead.

 

7.       The Secretary of State has considered all the representations and evidence. He is required to determine the same question, as to your rights under the regulations, as fell to be decided in the first instance by the  FUND. He is acting judicially and has no power to modify the application of the regulations to the facts of the case.

 

8.       Regulation J8 from the 1986 regulations, which covered inward transfers of this nature, does not place any obligation on an authority to conduct the transfer in a particular way or to provide advice before or during this process. When you took up pensionable employment with XXX City Council, Regulation J8 (1) provided, as far as material, as follows:

 

“J8(1) .... a transfer value offered to a person’s fund authority by the scheme managers        of his previous non local government scheme shall be accepted by them .... if the                  conditions specified in paragraph 3 are satisfied.

 

(2)...

 

(3) The conditions are that-

 

(a)...he has made a written request to his fund authority for the transfer value to be     accepted, and 

 

(b) subject to paragraph (4), the request was made not later than ... 6 months after he became employed in his local government employment”.

 

(4) The local government employer may in any particular case extend the period                   mentioned in paragraph (3)(b)”.

 

9.       Regulation J8 was amended with effect from 6 April 1988. So far as may be material to this case, the amendments extended the period during which written notice should be given from six to twelve months.

 

10.     If, however, the  FUND were to now consider any payment of a transfer value, they would have to give regard to regulation K13 of the 1995 regulations which as far as is relevant states:

 

"K 13 (1) Where a person who becomes a member has accrued rights to benefit under

 

            (a) an occupational pension scheme,

 

(b) to (d)......  

 

he may within 12 months of becoming a member (or such longer period as the local

government employer may allow) give notice to his fund authority that he wishes them to accept a transfer value in respect of some or all of those accrued rights from the relevant transferor.”

 

 

         

 

11.     The Secretary of State notes that you completed a form on 15 March 1988 indicating that you wished enquiries to be made regarding a transfer. He has considered whether this form constituted written notice that you wished the fund authority to accept a transfer value within the meaning of regulation J8 of the 1986 regulations. In his view it cannot be regarded as such. The Secretary of State has next considered whether you complied with the conditions in regulation J8 (3). He accepts the  FUND’s evidence that they prepared an option form and he considers that this form, if you had completed it, would have constituted written notice. He notes that there is no conclusive evidence whether you received it, but that, for whatever reason, you did not complete it. However, he also notes that the form was not prepared until 31 January 1989, outside the time limits in either regulation J8 (3) or its successor provision in the 1986 regulations. He concludes that you did not meet the mandatory requirement of  regulation J8, but he accepts that, so far as concerns the time limit, you were not able to do so.    

 

12.     However, the Secretary of State takes the view that, in preparing an option form and subsequent reminder letters after the expiry of the time limited period, the  FUND were effectively exercising the discretion in regulation J8 (4) of the 1986 regulations to extend the period. He notes that you do not dispute receiving  FUND’s letter of 4 February 1991 though, for whatever reason, you did not act on it. The Secretary of State cannot consider an appeal as to what if any extension an employer should have granted under regulation J8 (4) of the 1986 regulations or whether they should now grant one under regulation K13(1) of the 1995 regulations, because as far is relevant, regulation J5(2) of the 1995 regulations states:

 

“... the Secretary of State shall not determine any question that fell to be decided by the relevant employer in the exercise of  a discretion conferred on them by these regulations.”

 

Regulations J8(4) of the 1986 regulations and K13 (1) of the 1995 regulations are subject to a

discretion in that a local government employer “may” extend the period.

 

13.     The Secretary of State accordingly dismisses your appeal.  

 

14.     A copy of this letter has been sent to the  FUND.

 

15.     The above constitutes the Secretary of State's determination of this case. It is final and cannot be changed except by a judgement in the High Court. As the Secretary of State's jurisdiction is now at an end, no member of the Department may discuss or comment on the case further.