Bushra Chaudry Trustee Solutions

1. BushraChaudry Trustee Solutions

2. Pension Ombudsman Update Bushra Chaudry

3. Audience Participation Time !

4. Risks What % of Pension Ombudsman cases heard over the last three years related to ill-health claims? A: 39.1% B: 47.8% C: 52%

5. Risks The Pensions Ombudsman has recently criticised trustees and employers for responding “insensitively” to claims. A: True B: False

6. Risks If trustees outsource the handling of complaints to a third party, such as their administrator, who is responsible for how those complaints are dealt with? A: Trustee B: Third party (such as administrator) C: Sponsoring employer

7. Risks Which of the following carries the most risk of an increase in Pension Ombudsman claims? A: Large scale redundancy exercise B: Enhanced transfer value exercise C: Pension increase exchange exercise

8. Identifying areas of risk

9. The process

10. Managing risk A: Pay the benefit out as it is unreasonable to impose conditions on the payment of the death benefit once the trustees have exercised their discretion as regards the recipient(s). B: Continue to refuse to pay out the benefit until a signed discharge is received from Mr McCoy as it is unreasonable to expect the trustees to expose themselves to the risk of future claims. C: Revisit the decision to pay the benefit to Mr McCoy and consider other suitable recipients of the benefit under the scheme rules.

11. Managing risk A: There is no need to take any action in this case because Mrs Dent’s complaint falls outside the three year limitation period for Pension Ombudsman claims. B: There is no need to take any action in this case because Mr Dent the rules were considered and applied properly and Mr Dent received the correct ill-health benefit under the scheme. C: Mr Dent’s employer should have told him to speed up his application so he could be considered for the more generous benefit. Mrs Dent should receive generous compensation equal to the difference in Mr Dent’s pension instalments, the difference in her widow’s pension and a payment for distress and inconvenience.

12. How to manage risk • Watch out for risk triggers • Training (for trustees but also for third party administrators) • Complaints handling process • Keep thorough audit trails/evidence of reasoning • Awareness of current PO approach • “Firm but fair” approach.

13. PO’s parting shots “She was receiving twice as much as she was due. It may well be that she did not identify it in fact, but if she was heedless, whatever the reason, the Scheme should not be liable in consequence.” “Mrs McKinney was paid £300 to cover her non-financial loss. I do not accept her description of this figure as “insulting”, nor that she needed to return it.” “The LGPS is by any measure a good quality pension scheme...it would be strange for a local government employee to decline to join it on the grounds of uncertainty about the method of indexation or revaluation. I see no evidence to suggest that Mr Frost addressed his mindto the issue of inflation-proofing when he decided as he did.”

14. Q&A

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