Overpaid Armed Forces pension for 12 years, do I have to pay it all back?

Marcon

BikingBud said:

Marcon said:

BikingBud said:

In the same way as people should understand their tax liability or their monthly pay from their rank and pay spine and then deduction of food/accommodation/CILOCT etc I would expect people to know exactly what pension they are getting.

If the pension professionals charged with paying the correct pension can't get it right, why would you expect the recipients to believe they know better?

You could just disclaim knowledge about everything and say it always somebody else's fault. Or:

• Because the pension professionals are humans, they make errors in inputting data and follow the output of the computer.
• Whereas the recipient might invest in understanding the make up of the payment rather than just the answer.
• Because the pension tables are published
• If the individual went through the 75/05 election process, and if the pension has been in payment for 12 years it seems most likely, projections were made available for all service personnel.
• AFPS has had pension calculators with detailed breakdown since the 75/05 election process.
• As pay is not personally negotiated but paid from scales that cover ranks and steps with those ranks and their was fixed accrual rates for AFPS 75
• Contrary to the civil world people in the military often talk about wages and pensions and whether commutation might be worthwhile so you often know what your contemporaries are expecting and by comparison what you will get.
• Because it's the responsibility of all service personnel to ensure their pay and allowances are correct and by extension that approach should apply to pensions.

There may also be something we do not know such as a pension allotment following a divorce.

But we will only know if the OP comes back and adds more to further the discussion.

Or OP could just read the link in the first reply to their post, in which I gave the link to the Pension Ombudsman's take on this - because it's the PO who would have the final say if OP complains to them. Absolutely no reason why OP should get involved with any of the virtue signalling or other nonsense being trotted out by a few people on this thread.

xylophone

If the patient doesn't accurately describe the symptoms

Short of having a psychiatric problem of some kind, there must be very few patients who do not do their level best to explain what's wrong.

At all events, a medical error is just that, an error made by the medical profession.

If an error has occurred in this case, then the error was made by the administrator and I hold by my opinion that the administering 

body should have insurance to cover it.

The pensioner did not calculate his own pension - it was up to the administrator to gather the relevant information on which to base the decision.

Do IFAs, solicitors, accountants, doctors etc not  have to take out professional insurance? 

xylophone

 Absolutely no reason why OP should get involved with any of the virtue signalling or other nonsense being trotted out by a few people on this thread.

I don't see nonsense or virtue signalling?

Incidentally, in the very relevant thread I linked in my first post, I note that you yourself stated in your post

https://forums.moneysavingexpert.com/discussion/comment/80896623/#Comment_80896623

As always, cases are distinguished on the facts...but I feel profoundly sorry for the members and their families where they genuinely didn't realise (and could not reasonably be expected to have realised) they were being overpaid. After all, if the 'professionals' charged with administering the scheme didn't spot the problem, why would the 'amateur' receiving the payments?

CedricsDad

Blimey, never realised my post would trigger so many responses. my thanks to you all.
Just to clarify, (after more digging) my pension was reviewed as part of the McCloud Remedy last year and I was awarded a backdated 05 pension from my discharge in 2019.  This was based on my service from 1980 - 2012. (I served in the Reserves 2016-2019 as well)
The annual pension calculated for the backdated pension was apparently incorrect (and as a result the Terminal Grant) so the MOD is seeking to reclaim these overpayemts.  I assumed, like most servicemen/women that the pension would be calculated correctly.  
I'm waiting now for the Paymaster to contact me to see what options I am given to make the repayments.  I do wonder how the tax I have paid (on the wrong figure) will be accounted for.

ps Last year HMRC overtaxed me on my backdated Pension - it was only due to a knowledgeable MSE poster I was able to claim back the overpaid tax...the person I spoke to at HMRC just told me that there was nothing they could do. I was able to provide a reference (from this form) to correct them.

Once again my thanks to you all.

BikingBud

Marcon said:

BikingBud said:

Marcon said:

BikingBud said:

In the same way as people should understand their tax liability or their monthly pay from their rank and pay spine and then deduction of food/accommodation/CILOCT etc I would expect people to know exactly what pension they are getting.

If the pension professionals charged with paying the correct pension can't get it right, why would you expect the recipients to believe they know better?

You could just disclaim knowledge about everything and say it always somebody else's fault. Or:

• Because the pension professionals are humans, they make errors in inputting data and follow the output of the computer.
• Whereas the recipient might invest in understanding the make up of the payment rather than just the answer.
• Because the pension tables are published
• If the individual went through the 75/05 election process, and if the pension has been in payment for 12 years it seems most likely, projections were made available for all service personnel.
• AFPS has had pension calculators with detailed breakdown since the 75/05 election process.
• As pay is not personally negotiated but paid from scales that cover ranks and steps with those ranks and their was fixed accrual rates for AFPS 75
• Contrary to the civil world people in the military often talk about wages and pensions and whether commutation might be worthwhile so you often know what your contemporaries are expecting and by comparison what you will get.
• Because it's the responsibility of all service personnel to ensure their pay and allowances are correct and by extension that approach should apply to pensions.

There may also be something we do not know such as a pension allotment following a divorce.

But we will only know if the OP comes back and adds more to further the discussion.

Or OP could just read the link in the first reply to their post, in which I gave the link to the Pension Ombudsman's take on this - because it's the PO who would have the final say if OP complains to them. Absolutely no reason why OP should get involved with any of the virtue signalling or other nonsense being trotted out by a few people on this thread.

Unsure what you mean by virtue signalling but I understood the boards were designed to offer advice, those comments I provided should enable better clarity of the source of the problem. Going straight to the PO without understanding the grounds for the complaint or if the system was wrong or correct but deemed unfair would be premature. 

Straight to the PO?

What about internal resolution: https://assets.publishing.service.gov.uk/media/64089998e90e0740d874e925/Internal_Dispute_Resolution_Procedure__IDRP_.pdf

It seems now, thanks for the additional information, that the OP would have been on AFPS 75 and left the service after 32 years. With an immediate pension.

After a break, rejoining as a reservist 2016, the wage should have been to abated, you cannot get wage and pension although you can accrue further years.

Then as this was across the period affected by forced transfer onto AFPS 15, McCloud would have come into play and forced a review of the OP's complete service history 1980 - 2019, with a Remediable Service Statement being provided and the SP is required to make an election.

Great advice here: 
https://forcespensionsociety.org/2024/09/2015-remedy-mccloud-payment-adjustments/

Members who have made an election after 1st September 2024:
Your revised (alternative) pension benefits will be put into payment and an updated calculation will be carried out to confirm the actual over/underpayment and interest impact based on the date of implementation. You should allow up to four months for this to occur.
You will be written to by DBS Veterans UK once these changes have been processed and provided with a revised award notification. If your election for alternative benefits has caused an underpayment, Equiniti will issue any arrears and interest payments owed to you at that point.  If your election for alternative benefits has resulted in an overpayment, Equiniti will write to you with the details regarding repayment.

https://forcespensionsociety.org/pensions/ and https://forcespensionsociety.org/2023/08/enhanced-armed-forces-pension-calculator-user-guide/ 

as well as  for a small annual subscription they will assist to try and solve your issues.

I would strongly recommend @CedricsDad joins the Forces Pension Society and seeks competent advice. 

Unfortunately when something a large as MCcloud flushes the systems through, both those that were underpaid and those that were overpaid will be affected.

CSL0183

CedricsDad said:

Blimey, never realised my post would trigger so many responses. my thanks to you all.
Just to clarify, (after more digging) my pension was reviewed as part of the McCloud Remedy last year and I was awarded a backdated 05 pension from my discharge in 2019.  This was based on my service from 1980 - 2012. (I served in the Reserves 2016-2019 as well)
The annual pension calculated for the backdated pension was apparently incorrect (and as a result the Terminal Grant) so the MOD is seeking to reclaim these overpayemts.  I assumed, like most servicemen/women that the pension would be calculated correctly.  
I'm waiting now for the Paymaster to contact me to see what options I am given to make the repayments.  I do wonder how the tax I have paid (on the wrong figure) will be accounted for.

ps Last year HMRC overtaxed me on my backdated Pension - it was only due to a knowledgeable MSE poster I was able to claim back the overpaid tax...the person I spoke to at HMRC just told me that there was nothing they could do. I was able to provide a reference (from this form) to correct them.

Once again my thanks to you all.

If you are owe them £45k, I suspect they will split this into a £36k Gross + £9k NET deduction. 

The £36k will come off as gross payments in the future so if you receive a corrected £12k pa pension, you will be paid £6k pa for the next 6yrs (disregarding inflation adjustments) - This will pay back the £36k. 

As you received the £9k tax free lump sum though I suspect this will be a separate bill that you will need to satisfy with a £9k cash transfer or cheque payable. 

The 2 debts will or should be treated differently. 

CedricsDad

BikingBud said:

Marcon said:

BikingBud said:

Marcon said:

BikingBud said:

In the same way as people should understand their tax liability or their monthly pay from their rank and pay spine and then deduction of food/accommodation/CILOCT etc I would expect people to know exactly what pension they are getting.

If the pension professionals charged with paying the correct pension can't get it right, why would you expect the recipients to believe they know better?

You could just disclaim knowledge about everything and say it always somebody else's fault. Or:

• Because the pension professionals are humans, they make errors in inputting data and follow the output of the computer.
• Whereas the recipient might invest in understanding the make up of the payment rather than just the answer.
• Because the pension tables are published
• If the individual went through the 75/05 election process, and if the pension has been in payment for 12 years it seems most likely, projections were made available for all service personnel.
• AFPS has had pension calculators with detailed breakdown since the 75/05 election process.
• As pay is not personally negotiated but paid from scales that cover ranks and steps with those ranks and their was fixed accrual rates for AFPS 75
• Contrary to the civil world people in the military often talk about wages and pensions and whether commutation might be worthwhile so you often know what your contemporaries are expecting and by comparison what you will get.
• Because it's the responsibility of all service personnel to ensure their pay and allowances are correct and by extension that approach should apply to pensions.

There may also be something we do not know such as a pension allotment following a divorce.

But we will only know if the OP comes back and adds more to further the discussion.

Or OP could just read the link in the first reply to their post, in which I gave the link to the Pension Ombudsman's take on this - because it's the PO who would have the final say if OP complains to them. Absolutely no reason why OP should get involved with any of the virtue signalling or other nonsense being trotted out by a few people on this thread.

Unsure what you mean by virtue signalling but I understood the boards were designed to offer advice, those comments I provided should enable better clarity of the source of the problem. Going straight to the PO without understanding the grounds for the complaint or if the system was wrong or correct but deemed unfair would be premature. 

Straight to the PO?

What about internal resolution: 

It seems now, thanks for the additional information, that the OP would have been on AFPS 75 and left the service after 32 years. With an immediate pension.

After a break, rejoining as a reservist 2016, the wage should have been to abated, you cannot get wage and pension although you can accrue further years.

Then as this was across the period affected by forced transfer onto AFPS 15, McCloud would have come into play and forced a review of the OP's complete service history 1980 - 2019, with a Remediable Service Statement being provided and the SP is required to make an election.

Great advice here: 

Members who have made an election after 1st September 2024:
Your revised (alternative) pension benefits will be put into payment and an updated calculation will be carried out to confirm the actual over/underpayment and interest impact based on the date of implementation. You should allow up to four months for this to occur.
You will be written to by DBS Veterans UK once these changes have been processed and provided with a revised award notification. If your election for alternative benefits has caused an underpayment, Equiniti will issue any arrears and interest payments owed to you at that point.  If your election for alternative benefits has resulted in an overpayment, Equiniti will write to you with the details regarding repayment.

as well as  for a small annual subscription they will assist to try and solve your issues.

I would strongly recommend @CedricsDad joins the Forces Pension Society and seeks competent advice. 

Unfortunately when something a large as MCcloud flushes the systems through, both those that were underpaid and those that were overpaid will be affected.

Yes you're largely correct, but left on 05 pension, my time in the Reserves resulted with no pension as it was abated...plus I was put on the 15 pension in the Reserves -  which was reversed by McCloud Remedy.  Pity they used the wrong data to calculate the backdated pension.  I have no visibility how they calculated these figures.
I do wonder if the person who decided/reviewed my pension is competent...guess I'll never know.
I'll wait and see what the Paymaster proposes, hopefully they will be pragmatic and offer options.
Thanks for your help.
(had to delete links as I cant post with them)

BikingBud

Thanks for coming back it goes seem that there are complications and knock on effects of your non standard career profile, please do consider joining the Force Pension Society, they are set up to support ex-service members and there might be many similar cases where they can provide advice and assistance.

One of the factors leading to me leaving the service was nobody could advise how the system would treat any further years I served. They said they couldn't provide financial advice. I only wanted them to say how the system would aggregate extra time to accommodate missing years. Nobody could answer

Best wishes.

MEM62

Brie said:

molerat said:

Do you have to pay it back - it is not yours so yes

but

Can you appeal - yes

https://www.moneyhelper.org.uk/en/pensions-and-retirement/pension-problems/dealing-with-mistakes-and-overpayments-with-your-pension

Have they stated how the overpayment occurred as that is not an insignificant amount ?

You could argue that you will pay it back over the period it was paid - 12 years.  You could also argue that anything paid over 6 years ago is statute barred from recovery.

But as also stated elsewhere they should come to a reasonable agreement of a reduction in future payments, likely over the same length of time as the error existed so that it isn't too great a hardship for the recipient.  

But that might cause significant hardship.  No only would the OP be repaying £3,000 per year but, I would assume, his future pension payments will also be £3k a year lower.  Potentially the OP could see his income reduce by £6k per year.   

xylophone

One of the factors leading to me leaving the service was nobody could advise how the system would treat any further years I served. They said they couldn't provide financial advice. I only wanted them to say how the system would aggregate extra time to accommodate missing years. Nobody could answer 

If schemes can produce tables showing commutation factors and tables showing  contribution rates (all matters of fact, not opinion or advice) it is difficult to understand why there was no table/chart/decision tree to provide the information you sought. 

Unless you were in a unique situation, presumably others before you had drawn a pension under the circumstances you describe so that some sort of system had been devised?

Did you put your question in writing so that the administrator would have been required to give an explanation in writing of why your question could not be answered?