Delay with pension lump sum payment

xylophone

The second person said there wasn't a delay particularly, and some teachers had to wait 'several' weeks for the lump sum and that was acceptable. She was the one that said 'later payment of the lump sum' was not something he could complain about, 

That was clearly utter nonsense.

I hope that your husband has now made a formal complaint not only about the delay but also about the  inability of the administrative staff to provide a clear answer to his question.

Since he could have earned interest on the lump sum over the last six weeks he should certainly put in a claim for it,  8%?

https://www.financial-ombudsman.org.uk/businesses/resolving-complaint/understanding-compensation#:~:text=8% is also the same,gross before tax is deducted

lindos90

Thanks @zylophone, I think from the comments here it's clear he was misinformed about the use of the complaints procedure. I will suggest he starts writing the complaint letter this week. Thankfully he made notes of the dates and times that he called and what they said. Certainly the loss of interest is becoming more significant with each day.
In fact the lump sum was going to go into a 2 year bond, with the interest being paid into a current account to boost our 'income/pension'. The absence of the interest, now standing at 40 days it really mounting up! I hope they consider refunding that, as well as an explanation for the delay, and an apology for their absence of communication. 

dunstonh

In fact the lump sum was going to go into a 2 year bond, with the interest being paid into a current account to boost our 'income/pension'. 

That is quite high risk and alternatives may be better, unless it is very short term and you plan to spend all that money in the next 2-3 years.  You may wish to review that decision.

lindos90

dunstonh said:

In fact the lump sum was going to go into a 2 year bond, with the interest being paid into a current account to boost our 'income/pension'. 

That is quite high risk and alternatives may be better, unless it is very short term and you plan to spend all that money in the next 2-3 years.  You may wish to review that decision.

No, not high risk, its a fixed rate bond from a high street BS, maybe not the top interest rate, but we used Martins list to see the best ones at the time, and this was the one my OH felt happy with. Its not anything to do with stocks and shares. Hes done it for 2 years so we have the flexibility we need as we are looking to move in 2-3 years. Thanks for your concern though, but theres no way he would feel comfortable investing all (or some) of his money into something high risk.

dunstonh

No, not high risk, its a fixed rate bond from a high street BS, maybe not the top interest rate, but we used Martins list to see the best ones at the time, and this was the one my OH felt happy with. Its not anything to do with stocks and shares.

Using cash savings and the interest generated from them is higher risk.   You have reduced investment risk this way but you have increased shortfall risk and inflation risk.        Investment risk is a sliding scale and cash isnt bad for the moment but for a typical period of retirement, it would be higher risk.   
For example,  £100,000 cash where the interest is drawn for income would have the spending power of about £67,000 in 10 years time or £44,000 in 20 years time.     The interest generated will also be falling in real terms and sooner or later the capital will need to be accessed as the interest wont be enough and it creates a downward spiral from there where the value falls until it hits zero or death, whichever comes first.

There is also the possibility of putting it into a pension.  There are earnings in this tax year which could be potentially used for pension contributions.   The net tax relief vs tax payable on draw equates to 6.25% if a basic rate taxpayer.     So straight away, there is a gain before any investment (cash or otherwise) is made.   No risk and beats the cash savings.

lindos90

We finally found a complaints form on the website, surprise surprise one of the catagories for complaint on the drop down menu is late payment!

Took a while as it requested a timeline of info, discussions that took place in each telephone call and what we expect in order to put the complaint right etc but we finally finished it today. 

Got an auto response straight away so we know they definitely received it. That email also says they take 3 weeks to investigate and respond.

Let's see what happens! I'll pop back and let you know what happens.

xylophone

That email also says they take 3 weeks to investigate and respond.

One wonders whether or not the PCLS will appear in the mean time!

lindos90

xylophone said:

That email also says they take 3 weeks to investigate and respond.

One wonders whether or not the PCLS will appear in the mean time!

It might hurry them along a bit! At this point I actually think they have forgotten about the outstanding payment tbh. His monthly pension has been no problem, was authorised well in advance, but the lump sum apparently not authorised, why one was done without the other goodness knows! 

xylophone

I actually think they have forgotten about the outstanding payment tbh.

No he didn't get a posted letter about this figures, its all done through the members portal on the teachers pension website, all the documents with the figures on (for the agreed lump sum and monthly payment) are all on there.

I assume that when your husband saw the calculation he was satisfied that it was correct?

https://www.teacherspensions.co.uk/members/planning-retirement/calculating-benefits.aspx

If so, it seems unlikely that the Administrator discovered an error which needed correction - if there had been, one would have expected a note on his file and he has been informed that there is no such note.

 It seems more likely that there was an omission in  input ( a "box not ticked" perhaps) which has led to  a failure to send the payment to his bank account.

This could mean a need to wait  until the next  regular date  for a payment run. Given the fact that the error was not notified until 1 September, this could easily mean  two dates missed?

lindos90

xylophone said

 It seems more likely that there was an omission in  input ( a "box not ticked" perhaps) which has led to  a failure to send the payment to his bank account.

This could mean a need to wait  until the next  regular date  for a payment run. Given the fact that the error was not notified until 1 September, this could easily mean  two dates missed?

I get what you are saying, but wouldn't that would more likely to be the case if it was the monthly payment? Plus the TP payments are not done on a set day each month, they link your monthly payment date to your birth date, I assume to spread the workload across the month more, rather than paying every retired teacher on the same day.

In fact on a couple of the phone calls he made, he was advised he should receive the lump sum 10 working days after his first phone call, (when a request was made for it to be authorised) no mention of having to wait a clear month for the payment to be made.