Pension arrears

Sussex_Mike

I retired January 2021 with a small Teachers' pension.  I have today received notification from Teachers' Pensions that they have been advised by West Sussex County Council that I underpaid my additional pension between 2019 and 2020.  The underpayment is £198.87 and compound interest is £64.61.  Do I have any option other than just pay it?  If I don't pay, can they reduce my pension?

Marcon

Sussex_Mike said:

I retired January 2021 with a small Teachers' pension.  I have today received notification from Teachers' Pensions that they have been advised by West Sussex County Council that I underpaid my additional pension between 2019 and 2020.  The underpayment is £198.87 and compound interest is £64.61.  Do I have any option other than just pay it?  If I don't pay, can they reduce my pension?

Simply telling you something without explaining the consequences/actions you need to take (or not take) isn't exactly helpful. What options have they given you? If 'none' go back and ask them.

DRS1

 I have today received notification from Teachers' Pensions that they have been advised by West Sussex County Council that I underpaid my additional pension between 2019 and 2020. 

What is this additional pension thing?  Are they talking about Additional Voluntary Contributions?  Do you have any paperwork from 2019/20 to show what you paid (eg payslips) and is what is shown the right amount?

Or are you happy that you underpaid?  If so why not pay it now.  I bet that interest figure will only increase.

Sussex_Mike

They have simply said I have to pay it.  No explanation as to how it happened or what the consequences are if I don't pay it.

Marcon

Sussex_Mike said:

They have simply said I have to pay it.  No explanation as to how it happened or what the consequences are if I don't pay it.

Go back and ask. You're entitled to an explanation (which should also confirm the amount they claim has been underpaid) and if necessary time to pay if it's their error - if so, stamping their feet and demanding immediate payment including interest is something you can certainly challenge.

If you don't pay, then yes, I would expect to see your pension reduced until the outstanding 'debt' has been settled - it is just about within the last six years (a 'cut off' point the Pensions Ombudsman has cited in some cases where a scheme has tried to reclaim a longstanding overpayment, albeit this isn't quite the same thing).

najan49

How are they calculating the interest? Seems to be about 5% which seems over the top since the Bank of England bas rate was under 1% for half the period in question.