Local Government Pension Scheme Appeal Determination By The Secretary of State

Our Ref: LGR85/19/15 366 Index

July 1998

LOCAL GOVERNMENT PENSION APPEAL

SUPERANNUATION ACT 1972

LOCAL GOVERNMENT PENSION SCHEME REGULATIONS 1995

1. I refer to your undated letter to XXX Borough Council which they passed to the Secretary of State for the Environment, Transport and the Regions as you wished to appeal (under regulation 102 of the 1997 regulations) against the decision of Mr XXX, the Appointed Person, not to allow your local government pension scheme (LGPS) benefits to be paid from 26 May 1996 due to incapability on the grounds of ill-health. The Appointed Person determined that the case should be referred back to the employer (the company) in order that they may reconsider their decision, in the light of the results of the independent medical examination, with a view to bringing your benefits into payment. He further stated that in the event your benefits were brought into payment they were to be paid from the date of the medical examination by Dr XXX, but no pension increase was to apply until you reach your 55th birthday. The company determined that it would be reasonable for your deferred local government pension scheme (LGPS) benefits to be brought into payment in accordance with the conditions laid out by the Appointed Person.

2. It is noted that in your complaint form you did not specifically identify the date you considered your LGPS benefits should be paid from. The Secretary of State notes that Mr XXX determined that your case should be referred back to the company for them to reconsider, in the light of the independent examination, with a view to bringing your benefits into payment from 8 January 1998. The payment of LGPS benefits due to ill-health is not a benefit paid at the discretion of the employer. It is a mandatory requirement when certain conditions are fulfilled. At the time you ceased employment the test for immediate payment of benefits was whether a former employee is incapable of discharging efficiently the duties of their former employment by reason of permanent ill-health or infirmity of mind or body. The regulations also provide for benefits to be brought into payment subsequent to termination of employment if and when such a permanent incapacity became established. With effect from 28 March 1997 the 1995 regulations were amended and the test from that date for bringing benefits into payment is whether a former employee is permanently incapable of discharging efficiently the duties of their former employment by reason of ill-health or infirmity of mind or body.

3. The Secretary of State takes the view that he has the power to determine whether and from what date the LGPS benefits should be paid due to ill-health or infirmity of mind or body, although depending on the relevant date a different test may apply. The question for his determination therefore is whether at the time you ceased employment with the company on 25 May 1996 you were incapable of carrying out efficiently the duties of your former employment by reason of permanent ill-health or infirmity of mind or body, and so qualify for payment of your LGPS benefits with enhancement.

4. The Secretary of State has considered all the representations and evidence. Copies of all the documents supplied by the Appointed Person have been sent to you under cover of the Department’s letter of 6 May 1998.

5. Secretary of State’s determination: The Secretary of State having taken into account the appropriate regulations, finds that for the purposes of the 1995 regulations the balance of medical evidence indicates that you were suffering from permanent ill-health or infirmity of mind or body so that you were incapable of discharging efficiently the duties of your former employment at the time you ceased employment with the company on 25 May 1996. You are therefore entitled to payment of your LGPS benefits from 26 May 1996 with enhancement. The Secretary of State’s decision replaces that of the Appointed Person’s decision of 5 February 1998. The Secretary of State’s reasons and the regulations which he considers apply in your case are set out in the annex to this letter, which forms an integral part of the determination. He is acting judicially and has no power to modify the application of the regulations to the facts of the case. Having made his determination he has no power to alter it but you may refer the matter to the Pensions Ombudsman or to the High Court. Because of this officials may not discuss the case further.

6. The Occupational Pensions Advisory Service (OPAS) is available to assist members and beneficiaries in connection with difficulties which they have failed to resolve. His address is 11 Belgrave Road, London, SW1V 1RB (telephone number 0171 233 8080).

7. The Pensions Ombudsman may also investigate and determine any complaint or dispute of fact or law in relation to the local government pension scheme.

EVIDENCE RECEIVED

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

a. from Mr XXX; undated letter to XXX Borough Council with enclosures; and

b. from the Appointed Person; letter dated 27 April 1998 with enclosures (listed in the Department’s letter of 6 May 1998).

REGULATIONS CONSIDERED AND REASONS FOR DECISION

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

a. you are age 44;

b. you were employed by the company as a bus driver;

c. you employment with the company ceased on 25 May 1996 when you were dismissed on the grounds of incapability due to ill-health.

3. The Secretary of State in reaching his decision has had regard to the regulations, which, in his view, apply. The Secretary of State notes that you believe your LGPS benefits should have been paid from 25 May 1996 when you ceased employment with the company.

4. In considering your disagreement the Appointed Person arranged for you to be seen by an independent medical examiner. You were seen by Dr XXX XXX MB. ChB. DPH. FFOM on 8 January 1998. Dr XXX opined that you would not be able to drive a bus competently at the present or in the future. He further opined that you may be able to attempt duties of a less physically stressful nature. Following receipt of Dr XXX’s report he was asked by Mr XXX, the pensions manager for XXX Borough Council, whether in his view you were permanently incapable of discharging efficiently the duties of your former employment at the time you ceased employment. Dr XXX opined that under the remit of fitness for a specific set of industrial activities you would be unable, because of your physical condition, to fulfil your former duties as a bus driver efficiently or effectively now or in the future. He further opined that although he had not examined you in May 1996 it is reported that your complaint at that time was consistent with your current pathology.

5. From the information the Appointed Person gathered he determined that your case should be referred back to the company in order that they may reconsider their decision, in the light of the independent examination, with a view to bringing your LGPS benefits into payment from 8 January 1998, the date of the medical examination by Dr XXX. He further determined that as you were capable of other employment no pension increase should apply until your 55th birthday. The company decided that it would be reasonable to accept the Appointed Person’s decisions and conclusions.

6. The Secretary of State has considered all the evidence. He notes that the Appointed Person and the company determined that your LGPS benefits should be paid from the date of the medical examination, but that the Appointed Person did not consider the question whether your LGPS benefits should be paid from an earlier date, that is the date you ceased employment or a date between your ceasing employment and the date of the medical examination.

7. At the time you ceased employment the test the Secretary of State has to apply in reaching his decision is whether you were incapable of discharging efficiently the duties of your former employment with the company by reason of permanent ill-health or infirmity of mind or body (regulation D7). He notes that your employment was terminated by the company on the grounds of incapability due to ill-health. This in itself is not conclusive that you were permanently incapable of performing your former duties, that is that your condition would be unlikely to improve sufficiently for you to perform the duties of your former employment before your normal retirement date. The Secretary of State has therefore considered all the medical evidence including the opinions of the independent medical examiner. He notes that the Appointed Person and the company accepted Dr XXX’s opinion that you would not be able to drive a bus competently at the present or in the future. The Secretary of State also notes that Dr XXX opined that although he did not examine you in May 1996 it is reported that your complaint at that time was consistent with your current pathology. The Secretary of State takes the view that on the balance of probabilities your medical condition, which resulted in your employment being terminated, has not changed since ceasing employment with the company and therefore your LGPS benefits, with enhancement, should be awarded from when you ceased employment with the company.

8. The Secretary of State further notes that the Appointed Person determined that no pension increase should apply to your benefits until you reach the age of 55. However the conditions covering pension increases are set out in the Pension (Increase) Act 1971. The Secretary of State determines that the level of pension increases and when they should commence are as set out in this Act.