Disputes over ill health and early retirement pensions remain

Early Retirement and Ill Health Remained the Biggest Disputes, Says Pensions Ombudsman's Report

Early Retirement and Ill Health Remained the Biggest Disputes, Says Pensions Ombudsman’s Report

The Pensions Ombudsman’s 2010-11 report showed a marginal fall in the number of enquiries (3,066, fall of 16%) and cases taken on investigation (915, down 4%), against the previous year.

Ill health (110 closed cases) and early retirement (43 closed cases) pensions were the major sources of dispute. People will be sensitive to ill health pensions since it involves additional financial, medical and emotional uncertainties involving difficult judgments to be made which may add significant costs to the schemes, while early retirement  (especially if enforced) is an equally sensitive issue since errors can potentially impact their future retirement income.

The other contentious issue remained investment transfers (88 closed cases), since values often declined while money was out of the market during transfers.

Investigators dealt with over 40 per cent of cases without referring them to the Ombudsman or the Deputy Ombudsman.

“Mr. D was made redundant and his employer gave ill health as one of the reasons. However, he was told that he could not have a full ill health pension because he had been made redundant.

“The pension scheme regulations did not impose a bar on a member qualifying for an ill health pension on the basis of redundancy. The Pensions Ombudsman suggested to the administrator that the crux of the matter was that the member had to leave his job due to ill health, whatever the official reason might have been. The administrator agreed to reconsider its decision and consider Mr. D’s ill health pension application,” the report said giving an example.

“With resources inevitably stretched, avoiding harm to our ability to perform our function will take a great deal of commitment from us, and support and understanding from our stakeholders,” said present Pensions Ombudsman Tony King about the future, keeping the current budgetary constraints in mind and after 20 years of operation.

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