832 INDEX
LOCAL GOVERNMENT SUPERANNUATION REGULATIONS 1986 (the 1986 regulations)
LOCAL GOVERNMENT PENSION SCHEME REGULATIONS 1997 (the 1997 regulations)
1. I refer to your letter dated 21 June 2000 in which you appeal (under regulation 102 of the 1997 regulations) against the decision of Mr XXX, the Appointed Person for the XXX, in relation to your local government pension scheme (LGPS) dispute with XXX Council (the Council).
2. The Appointed Person, in his decision dated 8 April 2000, upheld the Council’s decision that they could not accept a back-dated application for you to become a member of the Local Government Pension Scheme from July 1989.
3. The question for decision: The question for decision by the Secretary of State is whether the Council should have accepted a back-dated application for you to have LGPS membership from 3 July 1989.
4. Secretary of State’s decision: The Secretary of State has decided that the Council could not accept a back-dated application for you to have LGPS membership from 3 July 1989 to 30 April 1995. He accepts that the Council were initially guilty of maladministration, but he finds that there is unconvincing evidence that you pursued your claim or grievance with reasonable diligence.
5. The Secretary of State therefore dismisses your appeal. His decision confirms that made by the Appointed Person.
6. The Secretary of State’s reasons and the regulations he considers apply in this case are set out in the annex to this letter, which forms an integral part of his decision.
7. 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 or enter into any further correspondence with you about the decision. The decision is binding and can only be overturned by a judgement of the High Court or the Pensions Ombudsman.
8. 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 they have failed to resolve. Their address is 11 Belgrave Road, London, SW1V 1RB (telephone number 020 7233 8080).
9. The Pensions Ombudsman may investigate and determine any complaint of maladministration or any dispute of fact or law made or referred in accordance with the Pension Schemes Act 1993. His address is 11 Belgrave Road, London, SW1V 1RB (telephone number 020 7834 9144).
1. 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 correctly applied in the circumstances. The disagreement you referred to the Appointed Person was whether the Council should have accepted your request for back-dated LGPS membership from 3 July 1989 to 30 April 1995.
2. The Secretary of State has considered all the representations and evidence, and has taken into account the appropriate regulations.
EVIDENCE RECEIVED
3. The following evidence has been received and taken into account:
a) from you: letters dated 21 June 2000 (with enclosures); 23 September 2000 and 20 November 2000;
b) from the Appointed Person: letter dated 9 July 2000 (with the enclosures copied to you with the Department’s letter of 17 July 2000);
c) from XXX (the fund) : letter dated 13 October 2000 (sent to you under cover of the Department’s letter of 18 October 2000); and
d) from the Council: letter dated 1 November 2000 (sent to you under cover of the Department’s letter dated 7 November).
REGULATIONS CONSIDERED AND REASONS FOR DECISION
4. From the evidence submitted the following relevant points have been noted:
a) You have been employed with the Council since 1 October 1973;
b) You were promoted to the position of Cook Production Controller, with effect from 3 July 1989;
c) On 14 December 1990 you were given a letter of appointment in respect of the above position;
d) On 1 May 1995 you opted to join the Scheme and became an active member;
e) On 15 January 1998 the Council wrote to inform you that they would be offering voluntary early retirement redundancies to certain Council employees;
f) Following an enquiry you made as to the date of your entry to the Scheme, the fund wrote to you on 18 October 1999 stating that you joined the Scheme on 1 May 1995;
g) On 23 December 1999, the Council wrote to you with their decision that they could not recommend you be granted back-dated entry to the Scheme;
h) On 21 February 2000 you appealed to the Appointed Person;
5. You contend that the Council:
i) took 18 months to give you a new contract of employment;
ii) provided incorrect information regarding pension entitlement in the letter of appointment;
iii) failed to respond to numerous requests for clarification on the issue; and
iv) have refused to take steps to remedy the injustice their mistake has caused.
Your letter of appeal also implies that you did not accept the Council’s proposed settlement for early retirement redundancy because it did not include the enhancement that you would have been entitled to if your LGPS membership had begun from the time of your appointment as Cook Production Controller. You further state that the Appointed Person’s decision “completely ignores the fact that, when I discussed the situation of the “missing years” with the fund in 1995, I was given misleading information in respect of the cost, impact and implications of my purchasing added years.”
6. The Appointed Person stated in his determination ‘When you became Cook Production Controller on 3 July 1989 the Local Government Superannuation Regulations then in force only allowed employees who applied to join to become members of the Local government Superannuation Scheme...Automatic membership was introduced from 1 April 1990 by a new regulation which also made it clear that this change applied only to employees who commenced whole-time employment after 31 March 1990. Furthermore, irrespective of the circumstances, there is nothing in the current or former regulations which will allow XXX to accept a back-dated application for you to become a member of the Local government Pension Scheme from July 1989.’
7. The Secretary of State in reaching his decision has had regard to the regulations which, in his view, apply. At the time you were appointed to the position of Cook Production Controller on 3 July 1989, the 1986 regulations were in force. Regulation B1A states that
(1) ‘ a person who was not a pensionable employee on 5 April 1988....shall not after that date become a pensionable employee unless he makes an election to become such.’
(2) ‘An election under paragraph (1) shall be made by notice given in writing to the body which is to become the person’s employing authority.’
These regulations were later amended by the insertion of paragraph (2A) that states –
“A whole time employee who commences his employment after 31st March 1990 shall, if he is eligible to make an election under paragraph (1), be deemed to have made such an election unless, before commencing his employment, he notifies the employing authority in writing that he does not wish to become a pensionable employee.’
8. The Secretary of State has considered the regulations. He finds, like the Appointed Person, that the regulations in force at the time you commenced your employment required you to make an election in writing to join the Scheme. He notes, however, that you do not dispute this and that this is not the basis of your appeal.
9. The Secretary of State has noted your contentions that the Council took 18 months to supply you with a contract of employment, and that, when they did so, it contained incorrect information regarding your pension entitlement. You commenced your appointment as Cook Production Controller on 3 July 1989, as stated in your letter of appointment, dated 14 December 1990. The Secretary of State notes that this is a time lapse of between 17 & 18 months. Condition 3 of the letter states that ‘Under Local Government regulations you will become a member of the Local Government Superannuation Scheme unless you choose to opt out and the appropriate contribution will be deducted from your pay.’ The Secretary of State notes that this statement is consistent with the regulations in force at the time the letter was written, but that it is an erroneous one none-the-less, because at the date of your appointment on 3 July 1989 different regulations applied, and they required you to make an election to join the Scheme. He accepts therefore, your contentions that the Council supplied erroneous information and that they took approximately 18 months to do so. He notes that the Council do not dispute this. In his view this constituted a failure of administration.
10. The Secretary of State has next considered your contentions that the Council ‘failed to respond to numerous requests for clarification on the issue’ and ‘refused to take steps to remedy the injustice their mistake had caused.’ You concede in your letter dated 23 September 2000 that ‘most of the contact I had with the Authority was between 1990 and approximately late 1993/early 1994, and the vast majority of these contacts were made either on a face-to-face basis or by telephone.’ You also state that ‘Unfortunately, I did not keep copies of the few letters I did send, and ...I did not receive any written response at all from either the Local Authority or the fund.’ The Secretary of State wrote to the Council and put to them your contentions that they did not respond to your requests regarding clarification on your pension status. The Council stated in their letter dated 1 November 2000 that they were ‘not able to find any evidence or record of any such request having been made.’ They go on to say ‘The Appellant has demonstrated an aptitude for correspondence on other matters and I find it difficult to accept that if this issue had been a matter of real concern to her and she had made repeated oral requests which had not been responded to, that she would have not made a written request for clarification.’ The Council also state that they ‘find it difficult to accept that there was, in reality, any misapprehension on the part of the Appellant, in that, prior to May 1995 she was not a member of the superannuation scheme. It must have been obvious to her, at that point in time, that she had not previously been a member of the scheme yet she expressed no surprise at this nor did she claim to have been misled.’ Whilst the Secretary of State is concerned to note your contention that the Council ignored or misled you over the course of the following 3 years with regard to your LGPS status, he finds that you have not produced objective evidence to substantiate it. Given the length of time which has since elapsed, he cannot draw a conclusion with any reasonable certainty about what in reality occurred.
11. The Secretary of State has next considered your contention regarding the role of the fund. in your decision not to purchase the “missing years” (he assumes you refer to the period between 1989 and 1995) in 1995 when you elected to join the Scheme. The Secretary of State wrote a letter to the fund on 14 September 2000, which put your contention to them. They replied on 13 October 2000 stating that “I note you seek a response to Mrs XXX’s contention that XXX gave her misleading information in respect of the cost, impact and implications of purchasing added years. However, I have seen no evidence to support her contention and until she produces such, I am not prepared to answer unsubstantiated allegations.” This letter was copied to you on 18 October 2000. The Secretary of State notes that this is a separate issue to what, to him, appears to be the basis of your appeal, i.e. you ask for ‘back-dated entry’ to the Scheme, from the time of your appointment to ‘cook production controller,’ as stipulated in your contract of employment dated 14 December 1990. The purchase of ‘added years’ by a member is independent of any particular period of employment, and is restricted only by the maximum membership of (normally) 40 years, and the member’s ability to make payments within Inland Revenue limits. It remains open to you to request to purchase added years, providing that your total membership will not exceed 40 years when you reach the age of 65. The fund should not have offered any advice about whether or not you would have been wise to purchase added years in 1995, though they should have informed you of certain facts, including the cost of cash purchase, or percentage of pay that would be deducted to meet the cost. The Secretary of State finds that you have not produced objective evidence to substantiate your contention that the fund gave you poor advice, therefore he has not considered this point further.
12. Finally, the Secretary of State has considered the actions you took in pursuing this matter between 1995, when you joined the Scheme by election, and 1999, when you apparently queried your pre-1995 membership status with the Council, and made enquiries about purchasing added years. Following a request for more information from the Secretary of State, you stated in your letter dated 23 September 2000 that - “In respect of documentation regarding the actions I have taken pursuing this matter with the Council and XXX., I am afraid that I have none other than the letters supplied with the appeal. As I explained in my original submission, most of the contact I had with the Authority was between 1990 and approximately late 1993/early 1994, and vast majority of these contacts were made either on a face-to-face basis or by telephone.” It appears to the Secretary of State therefore, that you took no further action with regard to you concerns over your pension entitlement from 1995 at the latest, until the question of entitlement arose during discussions on early retirement redundancy in 1999.
13. The Secretary of State is concerned to note that the Council took 18 months to supply you with a contract of employment, and that, when they did so, it contained erroneous information about your LGPS pension status. He is also concerned to note your claim that the Council ignored or misled you over the course of the following 3 years with regard to your LGPS status. Given that you signed a contract which stated that you were to become a member of the LGPS, he would normally expect such an administrative error to be resolved by the Council as soon as the matter was brought to their attention, provided that it was done with due diligence in a timely manner. In your case you claim to have done so, but you have been unable to produce any material evidence to support this. The Council state that they have found no evidence of your having made such requests. Whilst the Secretary of State is concerned by your account of events prior to 1995, he finds that you have not produced objective evidence to support your contentions. Furthermore, he is not satisfied that you pursued this matter with due diligence between 1995 and 1999, a period in which there appears to be no question that you knew your position with regard to your pension entitlement. Where an individual considers that he has a claim or grievance, he is expected to pursue it with reasonable diligence. In your case he cannot be satisfied that you did so, and the evidence suggests that at least since 1995 you did not. While he accepts there was maladministration by the Council in the first place, he cannot therefore accept that you have, solely on that account, suffered financial loss or injustice. In the circumstances he cannot offer redress by backdating your entry to the Scheme from 1990.