Editorial.023 29th April 2016. |
This Editorial at a Glance:
• The Pensions Ombudsman and Commutation Compound Interest on Overdue Payments; • G.M.P.(Guaranteed Minimum Pension); • Financial Conduct Authority and Pensions; • Your Vote and their Malfeasance. |
The Pensions Ombudsman – Overdue Payments |
Dear Reader, In March, a year after the original ‘Determination’ by his predecessor King, Pensions Ombudsman A.Arter has released a further commentary on the Milne Case which it will be recalled was in principle a challenge of the government for its collective failure to update and pay the correct Commutation at the conclusion of Service for both Fire Service Veterans and retiring Police officers. An error which led to its self-enrichment. Unfortunately for the government, and now it seems for the PO A.Arter, this is another Ancient Mariner’s tale which simply will not go away with more major errors to come. A legacy for PO A.Arter left by King his legally unqualified predecessor, a good ‘company man’ who had no interest in the man in the street, namely Scheme Members. But who spent his period in office glad handing his chums in the pension ‘industry’ acting rather successfully as a court jester playing the clown to a point where he inevitably became an embarrassment to the government and thus he had to go. Though it was not put as indelicately as that. King’s ‘legacy’ surrounding the Milne case severely damaged the credibility of the Pensions Ombudsman as an institution a legacy during which Mr.Milne described King and his government’s actions as… ‘they tried every dirty trick in the book to avoid payment…’. Rebuilding after such a breach of credibility and trust was the unenviable task which PO Arter took on last year and which he has been, in the main, slowly and successfully addressing since his appointment. Public trust and credibility in any government organisation is a difficult and delicate flower to grow and just a few frosts of ill-conceived ‘Determinations’ or ‘announcements’ rapidly destroys these re-emerging green shoots of essential ‘customer’ faiths, particularly if this ‘independent’ gardener in the allotment of pensions, does not tread lightly… In his latest rather rambling announcement PO A.Arter muses over events surrounding the ‘vexatious’ Milne case whilst making oblique references to the mess which King left him. This announcement is both time consuming and, at times, a disturbing and contradictory muse to read. Go Here. It seems that memories of the actual facts are already affected by amnesia in that no one involved seems to recall Mr.Milne et al’s collective Statutory rights in terms of Pension Scheme law to which its Members are entitled – it is not largesse by this or any other government. Nor do they recall those old expressions ‘a fair days pay for a fair days work’ nor ‘the rate for the job’ for these former public servants and thus this particular Albatross will remains draped around their collective necks, and so it should, until it is fully resolved. For the original Bugler coverage of the ‘vexatious’ Milne case, Go Here. In PO A.Arter’s crystal ball gazing it matters little what these collective Fire and Police Veterans might have spent their income on had they have been paid the correct ‘rate for the job’ at the beginning of this debacle. The fact is that the government collectively failed in self-enrichment to pay their bills correctly in the first place and now they must settle up – fully. In his reference to the latest ‘theme’ as he puts it, a poor choice of word for a Complaint, namely overdue underpayments which require compound interest on the debt, PO A.Arter appears to suggest at first that this is something the Veterans have thought up for their own amusement, or greed. This is of course nonsense, which far from being a ‘theme’, are simple legitimate claims and any attempt to dismiss Complaints as a ‘theme’ exhibits rather poor judgement about those who are very determined to pursue their rights in law. This is not a casual matter of statistics. It is clear, rightly, that these former public servants are not going to take no for an answer and will in all probability challenge any perceived further short changing through the Courts because as the Bugler has published(using an eminent barrister’s Opinion on the matter) is that there is a plethora of well-established case law, to the detriment of the government, the debtor, which requires it to pay the debt of the ‘ rate for the job’ with compound interest on these late Commutation repayments. The Bugler has already published a comprehensive Opinion extracted from a main Opinion on the ‘ compound interest’ issue, Go Here. These public servants well know, to their cost, that if the shoe was on the other foot and it was they who were the ‘debtors’ who owed the government money then the expectation would be that the government would recover their funds with interest to the very last penny. PO A.Arter should ask himself how he might react if, at the end of his tenure as the PO, he found himself as a former civil servant short changed with his pension and paid less than his expectation of the ‘rate for the job’; then what might he do? PO A.Arter well knows, or he ought to as a solicitor, the applicable law. The facts of the matter are once more unassailable. By its collective error the government has enriched itself at the expense of its retired public servants and now it seems at a superficial glance, unfortunately supported by its civil servant PO A.Arter, who collectively do not wish to pay the bills either. PO A.Arter certainly knows that when a government enriches itself by its error in law(Limitations Act 1980) and it is called to account the interest on that account is at commercial rates, namely compound interest at the very least at 6%+. The use of sweet words like ‘proportionality’, whatever that might mean, will not suffice in attempting to make the delivery of a bitter pill, sweet. In plain man’s speak Fire & Police Veterans were owed money by the government through its self-enriching incompetence but now it appears that their spokesman PO A.Arter is suggesting in a questionable statement that all is well and that these Veterans should be grateful for the small mercies of ‘proportionality’. One is sure that this impression was not his intent but that is how it badly reads… A bill is a bill… including compound interest… Which part of this statement does the government not understand? This has nothing whatsoever to do with Veterans being ‘out of pocket’ it is to do with justice, and dare we mention it in dealing with any government department, fair play? To fail even to investigate the issue of interest would be not only a failure of PO A.Arter’s Statutory duty but it would be seen to pay obeisance to his employer the government which given the early point in his tenure would be both disappointing and professionally damaging to the credibility of his office. What is particularly disappointing is that he then goes on to state the government’s position for non investigation and its ‘considerations’ in justification which we well know is penury where former Public Servants are concerned. How does that stand against so called impartiality and ‘independence’ and what legal authority does he quote and use for his decision not to investigate? Please let us all know… No man can yet serve two masters. It has all been tried before as his boss Baroness Almann CBE is currently finding out to her detriment . When one becomes a |
gamekeeper surely there cannot be the naive expectation that the ‘rules’ in the undergrowth will remain the same? Unfortunately, at this point, PO A.Arter suggests to us that he and his organisation are truly independent which is of course just so much ‘smoke and mirrors’ because as we well know this is certainly not the case. The Pensions Ombudsman was created by Parliament(us) to which it reports and of course, unless they are a collective charity registered with the Charity Commissioners which is unlikely, its employees(our employees) are all civil servants paid for by us the ever enduring Taxpayers. PO A.Arter would be well advised to cease to chant this particular mantra of ‘independence’ because we know where his salary comes from choosing alternatively and wisely to chant the mantras of impartiality, fair play, and transparency regardless of the government in office which is a difficult task. Now those aspirations will undoubtedly have the support of the man on the Clapham omnibus and the Fire and Police Veterans… Once more in two paragraphs the PO muses at length about how the payments are viewed and used by the underpaid Veterans. Frankly this is no one’s concern least of all PO A.Arter’s. It is their money and they can spend or moan about it to their heart’s content but what those emotions cannot be used for is an excuse for not paying the bill in full with compound interest in the first place. This all unfortunately rather smacks of is … ‘just let them eat cake’… PO A.Arter makes an obscure point that , if we read this right, that Veterans ought not to continue to litigate for their just desserts to obtain what is rightly theirs because it might ‘adversely affect others’, without giving any explanation of what this actually means in practice? Is this in someway meant to intimidate? In justification for not accepting further Complaints at this point in his musings PO A.Arter implies that he does not have the resources to deal with future Complaints, an example of which the Editor will return in due course at the end of this Editorial. If there is a resource problem then manage it out. With the expansion in the numbers of pension holders driven by his boss the Pension Minister then it is statistically inevitable that more Complaints will be brought forward for him to deal with and thus an anticipated justifiable expansion of budget by good forward thinking management is called for which would indeed be ‘proportionate’. Nevertheless PO Arter ends his announcement musings on an optimistic volte facia when he completely reverses himself in contradiction of his earlier musings it now seems he and the government can find the time, the energy, the resources(the money) and the optimism to change his mind and invite further Complaints on all these issues. Hopefully PO A.Arter will this time unlike King start at the right end? Would it not just be simpler to ask the representative bodies and interested parties, or as they seem to be known these days ‘stakeholders’ to support an informal joint class action test case on this second tranche of Complaints taking that as a working model for all the remaining Complainats? The problem with that is that King misused this time wasting ploy before in the process abusing goodwill and trust which is all gone. A far simply solution surely is just pay the overdue monies with compound interest and the restless natives will all go home. It is not their concern where the money comes from. The government is in credit with the ‘sweat of their brows’, now just pay the overdue bills with compound interest. This commentary by PO Arter is unsettling when viewed from several angles. It is disappointing to see the drift in PO Arter’s ‘independent’ professional stance in this instance whilst wresting with, as he sees it, an intractable problem particularly at a time this government is trumpeting the necessity for all to have pensions which we, formerly in the Public Service, all did. Whilst this is all well and good look what happens when it all goes wrong and when there is the raised expectation that these guardians of our pensions will act swiftly, impartially, and transparently in fair play ‘to put matters right’ when, as now, they are put to their first major test of credibility? We do not expect these Scheme minding-‘police’- to turn tail and run to the government when we go to them for help and P.O.A.Arter is not alone in this stance. His colleague Ms.Titcombe over at The Pensions Regulator seems to be suffering from this contagious panic at the moment as well. This is not encouraging on either front. PO A.Arter and Ms.Titcombe have an unenviable task which as the Bugler sees it to steer an impartial course between the rocks and the shoals of government but then that is what they chose to do and what they get paid for. It is clear that PO A.Arter has heard Mandarin Whispers directed at him reminding him who his political ‘boss’ is and thus the Mandarins hope is that as a risen Canute he will stem this rising tide of protests by disgruntled short changed former Public Service Pension Scheme Members. It is a vain hope… This vain hope is not ‘encouragement’ he should follow because as he knows it will make his position and the credibility of his organisation untenable with the pension holding taxpaying Public. Look where that attitude got King? One hopes in plotting his course that PO A.Arter will continue to steer his ship back to the harbour of trust and credibility because if he does not do so he knows well his is never the final adjudication but he can manage meantime at a stroke to undo the credibility and integrity of his office which he has, with assiduity and to his credit cultivated well during the period since his appointment last year. So before leaving this topic the bottom line is that PO A.Arter has publicly invited Fire & Police Veterans to submit their Complaints to him concerning this repayments. Certainly in preparing their Complaints in effect a bill there should be the assumption that these revised bills will include the element of compound interest on these long overdue repayments… Recently PO A.Arter released two videos entitled ‘How can we help’ and ‘What you need to know’ which at the time of going to press cannot be found on his website. Perhaps in para phrasing these titles he might be minded to answer these questions? How is that disabled FSV~RRB has a Complaint lying on file with him since January 2015 ? How is it that Mr.Carl Monk an ‘assistant investigator’(read clerk) resolutely refuse to progress this routine Complaint in spite of receiving a daily email reminder to do so? Does Mr.Carl Monk have an unhealthy professional relationship of joint obstruction and obfuscation with Mr. Warren at the LFRS to deliberately delay this Complaint? A Mr. Warren who has an established and burgeoning reputation of stonewalling with the ICO which will inevitably lead to his individual and corporate prosecution by the ICO such is his accumulating record on non compliance with the applicable laws. Has Mr.Carl Monk been given authority by the PO to throw away PO Arter’s ‘independence’, impartiality and duty of care to disabled FSV RRB or is Mr. Mr.Carl Monk just an embarrassing gross incompetence for which, given this extended period of lost opportunity in time for disabled FSV~RRB he should be dismissed for gross misconduct? What other explanation can there be for Mr.Carl Monk’s unsupervised juvenile ineptitude? These are the questions and how PO A.Arter can help and this is what we need to know…impartially, transparently, and publicly… |
G.M.P.(Guaranteed Minimum Pension) |
Occasionally at sea ships pass in the night and even by day whilst part of the superstructure may be visible their passage raises little comment(This is not an ode to the French Footballer and his visions of seagulls!). Such might be the uncommented upon passage of GMP into oblivion this April 2016 with the abolition of GMP. Many thousands of FSVs over the age of 65 years receive GMP and it is a headline note on their pay slips. But given the distrust of this government’s machinations concerning pensions as exhibited and confirmed by the ‘vexatious’ Milne Case all FSVs and indeed retired Police officers would be wise to view this parliamentary passage with a yellow eye. But what does all this mean at this early point and will it have an impact on the future receipt of the GMP element of pensions? Indeed it will because at its most simplistic a GMP statement will not appear on payslips hence forward but before that happens much book balancing must occur… When words like ‘discrepancies’; ‘mismatched data’; ‘more accurate actuarial valuations’; ‘reconciliation’; and most particularly ‘tolerance’ levels which to us means if the books do not balance what will be written off or what might be recovered from us then the alarm bells ought to be shrilling their little clappers off… This once more smacks of a surreptitious government discovery that the GMP books do not balance and it is better just to abolish it but the Treasury will insist that even after abolition the books before closure must be balanced and to do that all Pension Scheme ‘managers’ must engage with the original data holder the HMRC(the government) to sort their latest pension scheme mess out? Why have we not been made aware of this major change. Why indeed not, therein lies the rub? But first what is GMP and will it affect me in particular? It is probable that this will affect the vast majority of 1992 Firefighters pension Scheme members at least those before April 1997. It certainly affects the Editor, but will it have a financial impact either positively or negatively. That remains to be seen… For the following synopsis the Bugler is indebted to a real expert in this obscure pension field who has attempted to present his knowledge to us as far as possible in plain English in defining what GMP is. But there is no escaping the fact this is a complicated matter further complicated by a mandatory government demanded book balancing exercise following the abolition of GMP this April which will involve all Pension Schemes in dialogue with HMRC. The first question here of course is will every Pension Scheme ‘manager’, aka the LFRS, be honest with HMRC when it comes to their errors or will they attempt to defraud them as well. The latter is a criminals’ choice but the LFRS have never hesitated to use fraud before so why should it stop now? What is a GMP? A Guaranteed Minimum Pension (or GMP as it is commonly called) is the minimum benefit a UK occupational pension scheme must provide for a member if they were ‘contracted out’ of the State Earnings-Related Pension Scheme (SERPS). What does ‘contracted out’ mean? When launched in April 1978 the State Pension comprised two elements, the flat rate Basic Pension available to all who met the minimum National Insurance (NI) contribution requirements and a new separate variable element (known as SERPS) which was based on earnings and payable in addition to the Basic Pension. Good quality pension schemes were given the opportunity to opt out (or ‘contract out’) of SERPS. Many pension schemes chose to contract out and this was popular with employers and employees alike because it meant a reduced rate of NI was payable to reflect the fact that the State would no longer be responsible for paying this additional SERPS pension. However, the ‘trade-off’ was that as a condition of contracting out schemes had to promise to provide a minimum level of benefit namely the GMP. The GMP was intended to be broadly equivalent to the additional SERPS benefit the member would have received, had he or she not been in contracted-out employment. When did it apply? It applies for members of a ‘contracted out’ pension scheme between April 1978 and April 1997. N.B. Firefighters of this era contracted out. What else do I need to know? Although GMPs only applied for contracted out membership up to April 1997 they still form part of a member’s pension entitlement today. Different rules apply for pension increases on the GMP in relation to periods of service before and after 6 April 1988 and entitlements are extended to surviving spouses or civil partners on the death of a member. Although this is at a very early point and discussions continue concerning what is to be done if the books do not balance and what ‘tolerance’ there will be in repaying those underpaid and equally those who may have been overpaid it is not an ‘exercise’ that FSVs would be wise to ignore because looking on the bright side Pension Scheme ‘managers’ and government departments resolutely make ‘mistakes’ in their favour so the expression ‘self enrichment’ within the context of the Limitations Act 1980 surfaces once more and can be used against the HMRC to seek repayments and equally in defence of any ‘tolerance’ claim by the HMRC against an individual. Once more in self education because trust has long departed FSVs would be wise to read up on this entire scenario, particularly the ‘Reconciliation’ element, using the Net. A random search produces the following interesting insight, © acknowledged. Go Here. The Bugler would be grateful of a reminder from time to time to revisit this evolving debacle if this Editor’s crystal ball proves to be correct… |
Financial Conduct Authority & Pensions |
Your Vote and their Malfesance ? |