Child Accesses Mothers Pension After Her Death

Neutrino22

Hi.

My wife died recently. She left a government (council) workplace pension as she worked as a for the council for some time. I've contacted them about this, and they say the pension is payable in two parts. One part is for myself, her husband, and the other part is for my child, who is 13.

The pension department advised me that in order for my child to be paid the pension, it has to be paid into a bank account with his name. My son has special needs, and cannot manage money, and I've been trying to find another way to access his funds, so that I can manage it for him in a sensible way. Since he is home educated, it will likely go into his educational resources.

What can I do to have access to my child's part of my wife's pension, such that I am able to manage the finances in a sensible way?

Silvertabby

In my day, LGPS children's pensions were paid to their carer, to pay for their day to day needs.  Only once the child reached 16 would the annual/monthly pension be paid into their own account.

Or do you mean the lump sum death benefit?  That's a one-off tax free lump sum (if eligible, is paid in addition to survivor's pensions).  If so, then lump sums left to minors are usually placed in some sort of trust/account in the child's name until they are 18.

My sympathies to you both.

xylophone

It has to be paid into a bank account with his name.

 If this is the lump sum, you should be able to open an account in bare trust for your child.

https://www.skipton.co.uk/savings/childrens/childrens-trust-saver

Nationwide might help with the Bank account?

https://www.nationwide.co.uk/current-accounts/flexone/

Or you might try Santander

https://www.santander.co.uk/personal/current-accounts/123-mini-current-account

https://arcuk.org.uk/wp-content/uploads/2013/05/Helping-young-people-with-learning-disabilities-to-understand-money.pdf

Neutrino22

Silvertabby said:

Or do you mean the lump sum death benefit?

Thanks for your input. There's no lump sum. I'm informed by the council pension team that there is a monthly payment available for myself and my son. There was no option to take a lump sum. I'm not sure why, as I don't understand government workplace pensions.

Neutrino22

xylophone said:

It has to be paid into a bank account with his name.

 If this is the lump sum, you should be able to open an account in bare trust for your child.

I'm informed by the council pension team that there is a monthly payment available for myself and my son. There was no option to take a lump sum. I'm not sure why, as I don't understand government workplace pensions.

Albermarle

If your son is entitled to benefits due to his special needs, how do you deal with those ?

Neutrino22

Albermarle said:

If your son is entitled to benefits due to his special needs, how do you deal with those ?

Albermarle said:

If your son is entitled to benefits due to his special needs, how do you deal with those ?

The disability benefits come into my account. Perhaps an option with the pension is to set up a third party mandate with the bank?

Marcon

Silvertabby said:

In my day, LGPS children's pensions were paid to their carer, to pay for their day to day needs.  Only once the child reached 16 would the annual/monthly pension be paid into their own account.

Or do you mean the lump sum death benefit?  That's a one-off tax free lump sum (if eligible, is paid in addition to survivor's pensions).  If so, then lump sums left to minors are usually placed in some sort of trust/account in the child's name until they are 18.

My sympathies to you both.

My sympathies too - you don't need this on top of your recent loss.

The LGPS Regulations 1997 include the following (my emboldening of the text):

Discretions as to payment of children’s pensions

47.—(1) If a children’s pension is payable for more than one eligible child, the appropriate administering authority may apportion it amongst the children as they think fit.

(2) The appropriate administering authority may pay the whole or part of a children’s pension to a person other than an eligible child, to be applied for the benefit of one or more eligible children as the authority direct.

I also noted the following on HMRC's Community Forum: https://community.hmrc.gov.uk/customerforums/pt/80f8d65f-6561-ee11-a81c-0022480003c7

I'd go back to the local authority in question and ask if they would exercise their discretion in respect of the 1997 Regs (or later regs if these have been superseded), pointing out that your 13 year old has special needs and can neither have a bank account, nor handle cash. You might also point them to the HMRC CR link above, confirming other public sector schemes do this.

Alternatively, perhaps suggesting you set up an account in the name "Mr X [surname] re his son Y [surname]" might resolve the issue? That fits the requirement to have 'an account with his name'.

Lemon_dr1zzle

Neutrino22 said:

Silvertabby said:

Or do you mean the lump sum death benefit?

Thanks for your input. There's no lump sum. I'm informed by the council pension team that there is a monthly payment available for myself and my son. There was no option to take a lump sum. I'm not sure why, as I don't understand government workplace pensions.

There will be a death grant payable. 

xylophone

There will be a death grant payable. 

As here?

https://lgps.buckinghamshire.gov.uk/currently-payingin/how-your-lgps-pension-works/death-in-service-grant/#:~:text=A death grant is paid,for less than 10 years

Marcon

Neutrino22 said:

Silvertabby said:

Or do you mean the lump sum death benefit?

Thanks for your input. There's no lump sum. I'm informed by the council pension team that there is a monthly payment available for myself and my son. There was no option to take a lump sum. I'm not sure why, as I don't understand government workplace pensions.

The option to take a lump sum (and reduced pension) only applies to the member - in this case your wife. 

The death grant isn't an 'option' - it is automatic:

xylophone said:

There will be a death grant payable. 

As here?

https://lgps.buckinghamshire.gov.uk/currently-payingin/how-your-lgps-pension-works/death-in-service-grant/#:~:text=A death grant is paid,for less than 10 years