Scheme with normal retirement age of 60 refusing to pay deferred pension until 65

edited 30 November -1 at 1:00AM in Pensions, Annuities & Retirement Planning
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  • xylophonexylophone Forumite
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    It seems to me ( though no expert) that there is no doubt that your SRA is 60. http://www.cookham.com/community/equitable/finalsalaryh.htm

    The question then returns to the rules of your scheme and the relationship between scheme pension, GMP and the deferred DB rules referenced earlier in the thread?

    Incidentally, is the Administrator of the HSBC scheme Towers Watson?

    You might find this thread of interest http://forums.moneysavingexpert.com/showthread.php?t=4736856&page=9 but get the wet towel out and wrap it round your head before you begin.;)

    Do you have any pensions benefits at all, over and above the GMP?

    When you joined HSBC (or was it Midland Bank), were you actually permitted to join the scheme? I ask this because a relative of mine worked for a bank which required ten years' service before the employee became eligible for a scheme pension.
  • edited 20 May 2014 at 11:09PM
    Cyberman60Cyberman60
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    edited 20 May 2014 at 11:09PM
    Hi Xylophone, yes I joined the Midland Bank non-contributory scheme immediately in September 1973 and have had relevant documents intermittently sent to me over the years but more frequently over the past 10 years. I have no excess over GMP.... and sadly the administrator is Towers Watson.

    Another thing that crosses my mind is that GMP never existed until 1978, so how can it have such a devastating impact re franking on what I should receive at NRA of 60 when I had already been in the Scheme for nearly 5 years before its instigation !!
  • xylophonexylophone Forumite
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    I typed Midland Bank Pension Scheme deferred members into Google and came up with an entry relating to a determination by the Pensions Ombudsman
    pension schemes act 1993, part x - Pensions Ombudsman

    which would seem to indicate that you might have needed to be 26 or over to have qualified for a deferred scheme pension when you left?

    This might mean that there is no question of franking because you do not have any benefits over and above the GMP?

    The GMP for males is payable at 65 so it may be that TW are correct?

    There is also this https://www.hsbcpensioners.org/index.php any help here?
  • Hi Xylophone, they appear to be using franking as a get-out by what is inferred in previous letters they've sent to me on the NRA at 60 issue.

    eg... a letter I received 28th April 2009 in answer to an early retirement request from watsonwyatt:

    'The Plan is contracted out of SERPS. Any pension put into payment must be at least the same as the GMP due to be paid from age 65. The GMP is roughly the same as the pension you would receive if you had been contracted into the additional state pension at the time. '

    It appears to me that the administrators are 'moving the goalposts' as they are implying IMO that I would have deferred benefits if there was no GMP to be paid.
  • greenglidegreenglide Forumite
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    It appears to me that the administrators are 'moving the goalposts' as they are implying IMO that I would have deferred benefits if there was no GMP to be paid.
    But if so the benefits which could be taken at 60 (and continued at 65) would be less, possibly significantly so.
  • It's quite common to pay less from 60 and then step-up to GMP at 65. I'd have absolutely no problem with this but having nothing at 60 reinforces to me that some pension funds will do all they can to avoid a payment if they can. It's not much money at all in my case but it is the principle and dare I say it, 'fairness'.
  • PensionTechPensionTech Forumite
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    I've missed a very crucial part of this issue.

    I was under the impression from reading (most of) the thread that you had been granted preserved benefits of 6 years, regardless of the fact that the scheme was not obliged to grant you that at the time that you left.

    But in your very first post you say that Towers have informed you that you don't have any benefits OTHER THAN the GMP. This is important - it doesn't matter if your preserved benefits aren't OVER the GMP, if you had a small preserved benefit then it would be due from age 60 anyway. But that doesn't seem to be the case. It seems as though you have no preserved benefits.

    If that's the case then it sounds like you don't have any benefits that are due to go into payment at age 60, even though your NRA would be 60 if you did (and although it doesn't matter here, for clarity I am still 100% sure that a scheme can't change your NRA in respect of earned benefits without your consent - they can only change it for benefits earned in future). Franking and step-ups are irrelevant. In effect your preserved benefit is £0 and it will be stepped up to the GMP at GMP age - when you reach 65.

    I'm so sorry for being so horrendously misleading.
    I am a Technical Analyst at a third-party pension administration company. My job is to interpret rules and legislation and provide technical guidance, but I am not a lawyer or a qualified advisor of any kind and anything I say on these boards is my opinion only.
  • edited 21 May 2014 at 10:49AM
    SnowManSnowMan Forumite
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    edited 21 May 2014 at 10:49AM
    Cyberman 60, I would recommend you contact TPAS (The Pensions Advisory Service) and run this past them.

    http://www.pensionsadvisoryservice.org.uk/

    You would need to go via TPAS in any case to refer a complaint to the Pensions Ombudsman.

    It is quite an unusual one, and I don't know the answer as to whether they can do this.

    If the Normal Pension Age is 60 then preservation rules should apply. This means that they can't treat a deferred less favourable than an active member in relation to when a benefit is paid (although the precise application is complicated).

    It is just possible you are entitled to your deferred pension at leaving without revaluation from 60 to 65 increasing to your revalued GMP at 65. I am not suggesting that is right though, I am just saying it is possible.

    Don't assume the scheme administrators are right. There was a thread a while back where they were hopelessly wrong and only after a lot of effort did they concede their error.
    I came, I saw, I melted
  • edited 21 May 2014 at 10:53AM
    Cyberman60Cyberman60
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    edited 21 May 2014 at 10:53AM
    It is being argued that I have no preserved benefits by TW as I was under 26 when I became a deferred member at 24 after 6 years of employment. I need to see the Deeds of the Scheme at the time I was a member to see the clause that denies me the preserved benefits and TW have failed to provide this information even after I requested it.

    TW appear to be using an Act enacted in April 1975 to deny preserved benefits but I was a member from Sept 1973 so the question is have they applied that law retrospectively to override what would have been an advantageous situation for me. I am trying to find this out.


    Hi Snowman, thanks but this is already in the hands of TPAS and ongoing for about a month.
  • edited 21 May 2014 at 11:00AM
    SnowManSnowMan Forumite
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    edited 21 May 2014 at 11:00AM
    Cyberman60 wrote: »
    It is being argued that I have no preserved benefits by TW as I was under 26 when I became a deferred member at 24 after 6 years of employment. I need to see the Deeds of the Scheme at the time I was a member to see the clause that denies me the preserved benefits and TW have failed to provide this information.

    TW appear to be using an Act enacted in April 1975 to deny preserved benefits but I was a member from Sept 1973 so the question is have they applied that law retrospectively to override what would have been an advantageous situation for me. I am trying to find this out.


    Hi Snowman, thanks but this is already in the hands of TPAS and ongoing for about a month.

    Sorry didn't read the whole thread.

    As you were under age 26 at leaving then you wouldn't have qualified for a (preserved) deferred pension at leaving despite having more than 5 years service. The age 26 requirement went for leavers after 31st December 1985 if I remember correctly.

    That would have still left your GMP in the scheme to be paid from age 65, but no deferred pension.

    So sounds like the administrators may be right here that the only benefit you are entitled to is the revalued GMP from age 65.

    Had you been age 28 (say) at leaving with everything else being identical the answer would be different and you probably would have been entitled to some pension from age 60.
    I came, I saw, I melted
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