NHS Pension Scheme - deferred benefits

Eastbourne_granny

I've been helping my brother to claim his NHS pension. He is terminally ill with a life expectancy of less than 12 months. Everything on the NHS Pension Website says that, in this case, the pension can be taken in a lump sum. It says that on the main website, in the FAQs and in the printed booklets. However, when I downloaded the form (AW240) ready to take for him to sign, it says right across it in bold letters that taking a lump sum for a life expectancy of less than 12 months does not apply to members with a pension deferred before 06.03.1995. This restriction is not mentioned anywhere else. I called the NHS Advice Line and was told twice that he could take a lump sum in these circumstances, but because the staff had to go and ask a senior person for advice and could not give an explanation for the form, I also contacted the complaints department and they confirmed that the form is correct and not only can a Member with a deferred pension not take a lump sum for terminal illness, they also cannot commute their pension to a bigger lump sum under the 25% rule. I wonder if anyone knows the reason for this. I have not been able to get one. I have complained about the misleading information on the NHS website and in the literature available. It's not as if all the Members deferring their pensions before 1995 are all gone - my brother is 58 years old and because he looked up his entitlement before he was taken into hospital and was expecting to be able to take a lump sum this has caused him great distress at a very difficult time.

mjm3346

The Scheme changed in 1995, the old scheme does not appear to be easy to access anywhere on line. As you say it is only on the actual claim form the date is mentioned, not at all helpful.

Did find this-

[FONT=Arial,Arial][FONT=Arial,Arial]"Changes were made to the NHS Pension Scheme from 6 March 1995 in England and Wales (from 1 April 1995 in Scotland and Northern Ireland). Briefly, more choice and flexibility were introduced with benefit improvement financed by withdrawing special early retirement rights for new entrants. The main changes were as follows.....[/FONT]
[FONT=Arial,Arial].......The NHS pension can be commuted to a tax free lump sum if a member is terminally ill. The lump sum will be five times the ill health pension with an overriding cap of twice final year’s pensionable pay less the retirement lump sum. The normal lump sum (usually three times pensionable pay) is also payable"[/FONT]
[/FONT]

Eastbourne_granny

Hi, where did you find that? Clearly that is when the changes were made, but the information on the NHS Pensions Website gives the impression that existing members were automatically enrolled in the "1995" group, that does have those benefits. And then the rules changed again in 2008, and now there is the "Choices" exercise going ahead. Sadly, my brother has a life expectancy of two months maximum, otherwise I would challenge the ruling on the basis of the misleading information given on the website and in the available literature, plus the fact that there are no details available on the website for the "old scheme" and what happened to those Members. He was counting on having this entitlement, so that he could use the settlement to pay off his mortgage and leave his property to his sons. There must surely be other people that have encountered this situation.

mjm3346

It was in section 3 of this


http://www.parliament.uk/briefingpapers/commons/lib/research/briefings/snbt-03281.pdf

mjm3346

Eastbourne_granny wrote: »

He was counting on having this entitlement, so that he could use the settlement to pay off his mortgage and leave his property to his sons. There must surely be other people that have encountered this situation.

I would assume (do not know as fact) there should be some payment from the scheme even if he dies without drawing any of the pension


The scheme that replaced the one he is in (sorry, I can find nothing earlier) gives

Member dies with preserved pension

F3.

— (1) If a member leaves pensionable employment with a preserved pension under

regulation L1 and dies before his pension under the scheme becomes payable, a lump sum

on death shall be payable in accordance with regulation F5.
(2) The lump sum will be equal to 3 times the yearly rate of the member's preserved

pension, calculated as described in regulation L1

From here

http://www.nhsbsa.nhs.uk/Pensions/Documents/Pensions/1995regs(No300).pdf

Eastbourne_granny

Thank you for trying to help. I've read the parliamentary briefing paper, the original document it refers to, even the superannuation paper from 1972, and I can find no mention of these restrictions so far. I've asked the pensions regulator to explain this, they cannot answer within 15 days, and also the pensions advisory service. We have sent in the form AW240 because time is so short, but I would like to have an explanation to give my brother and no-one seems to be able to provide it. I do feel that this is something that has been "kept quiet", I can't believe it would be omitted from all available sources of information by accident. My comments were referred to the appropriate line managers by the complaints and quality section, but I have so far not been contacted. Frankly, to let someone with a terminal illness believe they have an entitlement and only tell them that they do not when they actually receive form AW240 is very cruel and most certainly unfair.

LindsayO

yes, this is not what you and your brother should have to be dealing with at this time. I don't have any knowledge that can be helpful to you, just wanted to offer my support.

davjan

Is your brother still employed by the NHS, even if on long term sick leave? If so, the HR department at his place of work should be able to take this on for him, and get it sorted very quickly. This is certainly what happens at my NHS Trust - all stops are pulled out by liaison between HR and Payroll departments. If he isn't still employed, it is still worth speaking to the pensions officer at his previous place of work for any advice and help - they may have a contact at the NHS Pensions Agency you could call, without going via a call centre.
Good luck, and my thoughts are with you.

Eastbourne_granny

Thanks Davjan. No he doesn't still work in the NHS he deferred his pension in 1988. He worked at the Whittington Hospital in London, but so many things have changed. In those days, he was employed by the now defunct regional health authority, rather than the NHS Trust, which was formed much later.

Oldernotwiser

Was he a member of a union when he worked for the NHS? Have you contacted his MP?