Treasury refuses to review ex-firefighter's diminished pension

Wednesday 09 June 2021

Treasury has rejected an official recommendation to reevaluate the pension of an ex-airport fireman who claimed that Government failures had seen up to 20% knocked off the value of his retirement money pot.

Pushing back on the findings of the States Complaints Board, Treasury Minister Deputy Susie Pinel said yesterday that there was not enough “material evidence” to support reevaluating Stuart Newman’s pension, following assessment from the governing body behind the pension scheme.

Mr Newman claimed at a Complaints Board hearing last year that he had been unfairly denied a revaluation on his pension and had not been clearly informed of changes to rates.

He said he had sought pension advice in February 2018, when he started to plan for early retirement and contacted his line manager to organise it.

Pictured: Mr Newman claimed between 10-20% of his pension was taken off because he had not been properly notified of changes in rates by the Treasury.

When he received advice back from the Treasury Department, he was told that no valuations on pension prices were being undertaken until "post 15th or mid-May" as a result of changes being made to the Public Employees Contributory Retirement Scheme.

On receipt of his pension, he found it significantly lower than colleagues who had got theirs earlier in the year due to Market Value Adjustment. 

Though the Treasury Department later allowed for revaluations for anyone who had applied before 1 May 2018, Mr Newman’s request for revaluation was rejected, with the Department claiming they had no record of any phone calls before 29 May and assessing him at the post-evaluation rate.

However, this was something Mr Newman disputed, with the Board noting at the hearing that he had a “very senior officer” at the Fire Service backing his claims that he had attempted communication as early as March.

Pictured: Mr Newman's complaint was taken to the Complaints Board after going through the Pension Fund's processes.

After going through a four-step complaints procedure for the Public Employees Pension Fund, Mr Newman’s complaint was then taken to the Complaints Board, and was heard by them in September. 

Following this, the Complaints Board recommended the department reevaluate Mr Newman’s situation, upholding his complaint.

Chris Beirne, one of the two Deputy Chairs, said: “It was clear to the Board that, contrary to the Department’s conclusion, contact had been made prior to this date and Mr. Newman’s account was entirely credible.”

He added: “We were surprised that such a significant change to the pensions process could have been implemented without there having been a notice period communicated widely to the Fund members."

Despite this judgement, the Treasury Minister yesterday confirmed that Mr Newman’s pension will not be re-evaluated.

Pictured: Acting on advice from the Pension Fund's governing body, Treasury Minister Deputy Susie Pinel said that Mr Newman's complaint would not be upheld.

She said that the original Public Employees Pension Fund complaint process had not identified enough evidence that any communication had been made before May 2018. 

The final step of this process has the Committee of Management, who are the Governing Body of the pension scheme, make an assessment, which is “final and bonding”, according to their guidance.

Outlining the Committee’s findings, she said: “The evidence provided to the Committee by the Treasury and Exchequer department included:

• (i) records of all calls made to the PEPT in the relevant timeframe which demonstrated that no call was made in respect of Mr Newman.; 
• (ii) all correspondence received from Mr Newman before and after the Stage 4 complaint decision which was provided to the Committee; 
• (iii) records of all calls made by Mr Newman's employer (who advised that he made the call on Mr Newman's behalf) as requested independently by the Committee as part of their investigation.  

“These call records also showed no evidence of a call to the PEPT made by the employer in the relevant timeframe, indeed the evidence offered proved that no call had been made.  

“The Committee undertook a thorough and in-depth review based on all of the evidence provided, and took legal advice, and, based on all of the factors, made the decision not to uphold Mr Newman’s complaint.” 

Pictured: Mr Newman served as a fireman at the airport for nearly 30 years.

Following the Complaints Board recommendations in December, the Committee of Management established a further Working Group to consider the Report's findings.

However, meeting in February this year, they “concluded that no new or material evidence was brought to the Committee as part of the Complaints Panel Hearing or the Report.”

Deputy Pinel added: “Whilst I appreciate the time and effort that has been spent in hearing the complaint, the Committee, and therefore Treasury and Exchequer as administrator, is unable to make payment of a higher transfer value in respect of Mr Newman. 

“Any such payment would constitute a Special Payment under the Public Finances Manual. The Treasurer of the States is not satisfied that there is a proper legal basis to make such a payment in these circumstances.”

The Minister did, however, agree that a review would be undertaken into the complaints process following this incident, to consider an extra independent stage of the process.

“Treasury and Exchequer is reviewing the PEPF Complaints Procedure to ensure that is consistent with modern best practice for pension complaints,” she stated.

“Treasury and Exchequer are liaising with Financial Services and the PEPF Committee about future proposals for the creation of an independent final stage to the PEPF Complaints Procedure through the Channel Islands Financial Ombudsman, who is independent of Government.”