Inherited Pension less than inherited contracted out deductions... newly widowed & worse off

ellisk

xylophone said:

not to hand now.. but i'm hoping I'm best talking to moneyhelper at this stage... thank you xylophone

You could find it helpful to have them at hand when you speak to MH.

yes, point taken... many thanks

 

ellisk

Marcon said:

Just come across this article which might explain things (and sadly confirm they are correct): https://www.telegraph.co.uk/pensions-retirement/news/husband-died-cut-state-pension-10001/

yes, the issue for my mum is that whilst the state pension has been reduced, the amount received from the contracted out pension is less... so overall she is worse off!   unlike the pensioner in the telegraph article... So i need to go after the pension provider, but will seek advice from MHelper first...

thank you again 

xylophone

So i need to go after the pension provider,

The provider must act in strict accordance with the rules of the pension scheme.

I am assuming that when your stepfather died and your mother advised the Administrator of her bereavement, she received a letter which gave details of what she would receive from the Scheme in her widowhood.

Have you seen this letter? And do you have access to your late stepfather's pension statements/scheme guide?

And remember that the Administrators of the Scheme have nothing to do with applying the Contracted Out Deduction.

This is a matter for DWP.

ellisk

xylophone said:

So i need to go after the pension provider,

The provider must act in strict accordance with the rules of the pension scheme.

I am assuming that when your stepfather died and your mother advised the Administrator of her bereavement, she received a letter which gave details of what she would receive from the Scheme in her widowhood.

Have you seen this letter? And do you have access to your late stepfather's pension statements/scheme guide?

And remember that the Administrators of the Scheme have nothing to do with applying the Contracted Out Deduction.

This is a matter for DWP.

okay thanks lots.. something else I need to find...  between her disorganization and my cluelessness, I'm glad I joined and posted here.

thanks again

xylophone

okay thanks lots.. something else I need to find...  between her disorganization and my cluelessness,

This is a very difficult period for you and your mother and understanding the interaction between the old state pension and contracted out pension schemes is not easy.

Perhaps you could ask your mother to look out the paperwork mentioned (or perhaps you and she could do this when next you visit).

When you have read through it (and perhaps tried to do the calculation as set out in link in my previous), matters might become clearer.

In connection with the above see https://www.gov.uk/additional-state-pension/inheriting#:~:text=The maximum you can inherit,on their date of birth.

If you are both still "all at sea", MH might be able to assist.

Billopp

I would like to point out that there has been a further article in the Sunday Times dated 22 october about the same subject.  

My state pension was cut by £2,500 after my husband died’

https://www.thetimes.co.uk/article/state-pension-uk-widow-how-much-husband-dies-pntmvhk83?spot_im_highlight_immediate=true&spot_im_reply_id=sp_nNNHCgsN_2386dd6f-a448-4a64-87dd-70e0bf900215_c_2X7yGXKK60jcgOU0E6W84hMQlAp_r_2X8OPfnk6ICuJZopnH1hqB9JBAg&utm_source=spotim&utm_medium=e-mail&utm_campaign=replied-message&spot_im_redirect_source=email

The lady took it to court and won the case but the DWP appealed and took it back to court and she lost.

I think that the final decision was wrong. If you have the time you can read it in the following link.

https://www.thetimes.co.uk/article/state-pension-uk-widow-how-much-husband-dies-pntmvhk83?spot_im_highlight_immediate=true&spot_im_reply_id=sp_nNNHCgsN_2386dd6f-a448-4a64-87dd-70e0bf900215_c_2X7yGXKK60jcgOU0E6W84hMQlAp_r_2X8OPfnk6ICuJZopnH1hqB9JBAg&utm_source=spotim&utm_medium=e-mail&utm_campaign=replied-message&spot_im_redirect_source=email

Anne Dumbreck Robins v Secretary of State for Work and Pensions

[2023] EWCA Civ 890

https://caselaw.nationalarchives.gov.uk/ewca/civ/2023/890

I think the judges were saying that 50% of her inherited Guaranteed Minimum pension (GMP) can be deducted because it was paid for by the employer and employee paying reduced national insurance contribution.

I don't think the three judges decision is correct because as far as I am aware employer and employee paid reduced NI because the employee was being made to give forgo/ give up the state second pension ie SERPS because they were made to contract out by their employer. Nothing to do with subsidising the contracted out pension scheme.

I think everyone should be worried by these two case because I think it effects everyone who has a spouse who was contracted out of SERPS and they reached state pension age prior to 6 April 2016 under the old state pension.