Following a court victory earlier this week pension campaigners are stepping up the pressure on the government to provide compensation with a special briefing note for MPs.
On Wednesday Justice Bean at the High Court ruled in favour of four pensioners who brought a case against the government for rejecting the findings of the report produced by the Parliamentary Ombudsman in March.
The court ruled that the government was guilty of maladministration by providing inaccurate information about the security of final salary pensions which misled people into believing their pensions were safe when they weren’t.
In addition, Justice Bean agreed with the claimants that the government’s decision to reject the Parliamentary Ombudsman’s finding of maladministration was unlawful and that John Hutton, the Secretary of State for Work and Pensions', reasons for rejecting the findings were not reasonable or rational.
As a result, the Court stated the government must reconsider its rejection of the Ombudsman’s recommendations to compensate people and restore their full pensions. Meanwhile the government has agreed to pay all the costs of the case and also the costs of any future appeals.
However Dr Ros Altmann, an independent pensions consultant and former government adviser, warns the Department for Work and Pensions (DWP) is now trying to pretend that the ruling is not so bad which she says is “real political spin at its worst”.
She says that, in his statement to the House of Commons, Hutton talked of delays and taking time to consider the judgement and about thinking carefully, but she asks just how much longer do these people have to wait.
“It is outrageous to make them wait more, their lives are in ruins. Government needs to show leadership and act quickly rather than delaying and spinning. It is trying again to ride out the pressure and delay providing justice,” says Altmann.
As a result she has prepared a short briefing note for MPs, outlining the Court’s verdict and what it means, to try and encourage members of all political parties to put pressure on to uphold the Ombudsman’s findings and provide claimants with a compensation package.
The move follows comments from both the Conservatives and the Liberal Democrats who have threatened to table amendments to the current Pensions Bill if the government refuses to take action, while Altmann says over half of all the MPs in the Commons have now signed Early Day Motions to support compensation.
David Laws, Liberal Democrat Shadow Work and Pensions Secretary, says: "John Hutton's response to the court ruling is frustrating and will cause more anger amongst pensioners. The government are saying they are still thinking of appealing against the court judgement even though the judge was clear that on the main issue the government doesn't have a leg to stand on.”
And he warns it is to be hoped the House of Commons will impose a fair compensation settlement on the government if no solution has been offered by Hutton before the Report Stage of the Pensions Bill in late March.
Laws adds: “Failure to accept the umpire's decision is not an appealing characteristic for sportsmen, and is even less so for a government minister after years of delay, and MPs from all parties are already considering tabling appropriate amendments."
And Phillip Hammond, Conservative Shadow Work and Pensions Secretary, has pointed out that “for many of the victims of this crisis, waiting until 2009 or 2010 for a Conservative government to address the problem is not an option. The best way forward has to be for this Labour Government to take the lead and find a solution now - built on a cross-party consensus."
However he adds: “We are not expecting the government to write a blank cheque with taxpayers' money. But it should be looking at using unclaimed pensions and financial sector assets, and at whether forcing a failed pension fund to buy annuities is the best use of scarce resources belonging to fund members.”
If you have any comments you would like to add to this story or would like to speak to its author about a similar subject, telephone Nyree Stewart on 020 7034 2681 or email [email protected]IFAonline
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