Local Government Pension Scheme Appeal Determination By The Secretary of State

601 INDEX 10 August 1999

Our Ref: LGR85/18/199

LOCAL GOVERNMENT PENSION APPEAL

SUPERANNUATION ACT 1972

LOCAL GOVERNMENT SUPERANNUATION ACT 1986 (the 1986 regulations)

LOCAL GOVERNMENT PENSION SCHEME REGULATIONS 1997 (the 1997 regulations)

1. I refer to your letter of 15 June 1999 in which you appeal (under regulation 102 of the 1997 regulations) against the decision of Mr XXX, the Appointed Person in relation to your local government pension scheme (LGPS) dispute with XXX Council (XXX).

2. The Appointed Person found that:

a) when your employment with XXX Town Council (the town council) ceased in 1989 the 1986 regulations allowed you to opt to aggregate the period of your reckonable (pensionable) service with XXX District Council (the council) for which you had been awarded preserved benefits payable from age 60, with your town council pensionable service;

b) to do so you had to take advantage of this option within three months of your employment with the town council ceasing;

c) there is no facility within the regulations which allows the council or either of your former employers to accept an option made once the three month period has expired.

3. The Secretary of State’s powers under regulations 102 and 103 are to reconsider the original disagreement referred to the Appointed Person under regulation 100.

4. The question for decision: The question for decision by the Secretary of State is whether the LGPS benefits you accrued while working for the council should have been brought into payment from 1989 when the LGPS benefits you accrued with the town council were paid.

5. The Secretary of State has taken into account all the representations and evidence.

6. The Secretary of State’s decision: The Secretary of State has taken into account the appropriate regulations. He finds that at the time you ceased employment with the town council you were not entitled to immediate payment of you’re council pension benefits unless you elected to combine them with your town council benefits. You did not elect to do so. However, the Secretary of State considers that on the evidence available it is likely that you were not aware that you could elect to combine your benefits. He further considers that it is reasonable to assume that had you known, you would have elected to combine them. He finds therefore that in the specific circumstances of this case you should now be given a period of three months, from the date of this letter, in which to elect to have your benefits combined. He further finds that if you do so elect, the council should treat your election as if it had been made within three months of you ceasing employment with the town council. His decision replaces that made by the Appointed Person. The Secretary of State’s reasons and the regulatory provisions which he considers apply are set out in the annex to this letter, which forms an integral part of this decision. He is acting judicially and has no power to modify the way the legislative provisions apply to the facts of the case. Having made his decision he has no powers to alter it but you may refer the matter to the Pensions Ombudsman or to the High Court. Because of this the Secretary of State’s officials cannot discuss the case further.

7. The Occupational 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).

8. The Pensions Ombudsman may investigate and determine any complaint or dispute of fact or law in relation to the local government pension scheme. His address is 11 Belgrave Road, London, SW1V 1RB (telephone number 0171 834 9144)

9. A copy of this letter has been sent to the Appointed Person and the Pensions Manager.

EVIDENCE RECEIVED

1. The following evidence has been received and taken into account:

a) from you: letter dated 15 June 1999 with enclosures;

b) from the Appointed Person: letter dated 23 June 1999 with enclosure (listed in the Department’s letter of 29 June 1999) and

c) from the council: letter dated 7 July 1999 (copied to you on 7 July 1999).

REGULATIONS CONSIDERED AND REASONS FOR DECISION

2. From the evidence submitted the following relevant points have been noted:

a) you were employed by the council from 1972 to 1979;

b) you accrued pension benefits in the LGPS for this period and on leaving became entitled to deferred pension benefits;

c) you were employed with the town council from 1983 until you were made redundant in 1989;

d) you accrued separate pension benefits for this period in the LGPS; and

e) because you were aged 50 when you were made redundant the town council pension benefits became payable immediately;

3. In your letter to the Appointed Person you considered you should have been in receipt of your council pension benefits from when you retired at the age of 50. You disagree with the council that your retirement in respect of these benefits is with effect from 9 May 1999. In your appeal to the Secretary of State you explain that you did not apply for your council pension benefits to be paid when you were made redundant as you were not aware that you had to. You consider you should have been advised.

4. The Appointed Person found that for your council pension benefits to have been paid from the time your town council pension benefits were paid you would have had to have opted to do so within three months of being made redundant; that you did not do so; and that it is to late to do so now.

5. The Secretary of State in reaching his decision has had regard to the regulations which, in his view, apply. At the time you were made redundant from the town council the 1986 regulations were in force. These regulations provided for the immediate payment of pension benefits for that employment where an employee is made redundant. The Secretary of State notes that it is not disputed that you were made redundant and as a result your town council pension benefits were paid immediately. Provision is also made in these regulations that a member may elect to combine separate pension benefits (regulation E16). He considers that the tests he has to apply in this case are whether the rules of the scheme required you to be informed that you had the right to elect to combine your benefits, whether there is any evidence you were not informed and, if you had been aware at the time, that you would have done so.

6. The Secretary of State is satisfied that the rules of the scheme did require you to be informed of your right to elect, since you could not have done so without being so informed. Additional information was sought from the council about the method used to inform members of their right to elect to combine separate LGPS benefits in these circumstances. They explained that due to the short time available they had been unable to find any information sent to deferred members. They consider that it was probable that as the amendment only referred to deferred members who were re-employed each case would be looked at when the person retired or left for the second time and they would then be given the opportunity to combine they benefits if they wished. They accept that if this was the case you were overlooked when you retired from the town council.

7. The Secretary of State takes the view that there is some evidence to suggest that you were not informed of your right to elect to combined your LGPS benefits either at the time you were made redundant or earlier. He has therefore considered whether there is any evidence to show that you would have combined them had you known of this option. Whilst there is no written evidence to show that you would have so elected the Secretary of State considers that it is reasonable to assume that had you been aware of the right to elect you would at least have sought information from the council about the amount of benefits you would have received if you elected to combine them. The Secretary of State concludes therefore that in the specific circumstances of this case you should be given three months from the date of this letter to elect to combine your benefits and that the council should treat such an election as if it had been made within three months of the town council pension benefits being paid.