Retiree Pension Cut

[ORAC]

https://inews.co.uk/news/politics/veterans-pensions-cut-from-christmas-government-computer-error-1298124

Hundreds of veterans’ pensions cut by over £500-a-year from Christmas due to computer error

Hundreds of military veterans’ (https://inews.co.uk/topic/military-veterans) pensions are being cut by up to £600-a-year due to a computer error that led to years of overpayments, i can reveal.

As the nation prepares to commemorate Remembrance Sunday, veterans have received letters from Equiniti Paymaster, the firm that manages the Armed Forces Pension Scheme (https://inews.co.uk/inews-lifestyle/money/pensions-and-retirement/earliest-age-savers-access-pension-rise-two-years-1271374)on behalf of the Government, informing them of cuts to their monthly payments.

The reduction follows an investigation by Her Majesty’s Revenue and Customs (https://inews.co.uk/topic/hmrc) (HMRC) into computer errors that the tax authority now claims led to, in some cases, decades of over payments to veterans…….

[Herod]

And a Happy Christmas to all our veterans.

[alfaman]

Sounds pretty appalling, but somehow not surprising. It's not strictly the same, but there are ACAS guidance applicable to salary over payment: they shouldn't just arbitrarily start under paying to compensate, even supposing their maths is correct, this time.

If the overpayment was a long time ago, or overpayments have been going on for several weeks or months, your employer should:

be flexible and fair claiming the money back
agree a repayment plan with you if needed

https://www.acas.org.uk/check-if-your-employer-can-make-deductions-from-your-wages

[Wrathmonk]

My mother received such a letter about 6 months ago informing her that her widows pension had been overpaid (no timescale given) and will be reduced with immediate effect (it turned out by less than £10 per month in the end).

The letter clearly stated that no overpayments needed to repaid.

[Richard Dangle]

Read to the bottom of the article and you will find this pragmatic advice for anyone so affected.

Were it me (and I guess it still could be) I would take the time to do all this and more (write to me MP etc) even if it were tuppence happeny a month.

We are talking retired folk here; you can't be ignored...write long letters...someone somewhere has to answer them. Get your Victor Meldrew head on folks. Turn it into fun for you and a size nine headache for some one else.

Nowt like getting your money's worth :)Advice to Military veteransMembers of the Armed Forces Pension Scheme (AFPS) have been advised they are facing a cut to their income may have a right keep their payments at the current level, despite being told they have no right of appeal.

Nigel Kern, pensions operations manager at the Money and Pensions Service (MPS), told i: “This can be distressing for those affected – but we are here to help.”

As a first step Mr Kern advised veterans affected by the cuts to talk to the pension administrator Equiniti. If a repayment has to be made, then it’s normally reasonable to allow you to repay over the same period it was paid. For example, if you’ve been overpaid for two years, you should be allowed two years to repay.

Military pensioners should also consider whether they have a ‘strong reliance’ case. The AFPS is obliged to consider cases where veterans can prove they had no reason to think there was an overpayment, and that they have come to rely on the money and repayment would cause significant hardship.

If veterans are not happy with responses from the pension administrator, they can complain to The Pensions Ombudsman if the scheme insists on recovering the over-payment without reasonable conditions. However, the Ombudsman will support the recovery of overpayments unless a strong reliance case can be shown.

To speak to a pensions expert at the Government’s MoneyHelper service for free call 0800 011 3797 or find more information online at www.moneyhelper.org.uk (https://eur02.safelinks.protection.outlook.com/?url=http%3A%2F%2Fwww.moneyhelper.org.uk%2F&data=04%7C01%7CBrendan.Mcfadden%40inews.co.uk%7C9fc777a9b587 4242fb1208d9a5ed984a%7C0f3a4c644dc54a768d4152d85ca158a5%7C0% 7C0%7C637723262146363171%7CUnknown%7CTWFpbGZsb3d8eyJWIjoiMC4 wLjAwMDAiLCJQIjoiV2luMzIiLCJBTiI6Ik1haWwiLCJXVCI6Mn0%3D%7C10 00&sdata=NzeJVksLw56nD%2Bp4a1eAlgHzbk5yQoAu%2F4gLbeSno5k%3D&reserved=0).

[Krystal n chips]

Taken from the article.

" This exercise was driven by the government and impacts all contracted out pension schemes in the UK.”

This is quite disturbing as it implies that anybody else who was a participant in such a scheme will also find themselves receiving the attentions of HMRC.

What will be "interesting" is if any attempt to abrogate responsibility is offered by them. When I had to have my tax code changed on retirement and notified them, I thought that would be that. Hence the arrival of the letter saying "you owe us " came as a surprise.

On contacting them, the nice lady went to great lengths to explain it wasn't my fault and, the farcical bit, amazingly it wasn't theirs either !...so nobody was to blame !....hence I did ask why. then, as the cock up was caused by HMRC not changing the tax code, do you want the money back ?,,,,short ans was, unfortunately they were obliged to recover public funds in such circumstances. Nice to be able to abrogate your responsibility for your own mistakes whilst still using legislation to get the money back.

This "it's nobody's fault " isn't exclusive to HMRC, the letter I got from the DWP also went to great lengths to politely say the same...along with the demand for repayment and the same "recovery of pubic funds" etc....and the helpful reference to the legislation just as a reminder at the end.

[Lordflasheart]

Questions -

1. Is this just a future reduction in a pension that is currently being paid ?

2. Or a clawback of previous overpayments ?

3. Or BOTH ??

4. Is there any apparent date from when this 'error' originated ?

5. Does anyone think this is wider than just Forces Pensions and or Equniti ?

6. ... What about the tax complication on 'overpayments' ...?

Q. ... "What is brown and white and steams and comes from Equine -itty ?" ...... A. ... "The horseman knew her !" ... ;)

LFH
...

[vascodegama]

My question is what has this got to do with the "contracted out" bit ? Surely income is just that and the tax code calculated accordingly.

[ORAC]

My question is what has this got to do with the "contracted out" bit ? Surely income is just that and the tax code calculated accordingly.

https://forcespensionsociety.org/2019/12/the-uk-state-pension-the-lowdown/

[ForcesPensionSociety]

This one explains the 'contracted out' issue:

https://forcespensionsociety.org/2021/02/guaranteed-minimum-pension-reconciliation/

The calculation was done when you started to draw your state pension and Equiniti would have been sent a notification of what you Contracted Out Deduction was. They have no way to check whether what DWP tell them is right - a bit like the tax code, they are told what it is and have to apply it.

[Old-Duffer]

I'm still irritated that both my wife and I were caught in the split pension award trap where there was an abatement for those leaving early in the year. What made it all the more annoying was that my desk officer was complicit in ensuring that I was 'out the door' earlier than initially agreed - this was AFPS75 for both of us, although there was ten years between Mrs (ex Sqn Ldr) OD and me leaving.

For my wife, who had changed her name to mine and been serving with that name for a number of years, she had to produce all sorts of extra paperwork before eventually getting her due.

Old Duffer