Pension query

[Gloriousgardener11]

I retired at the end of August this year and I have three pensions to draw from.
Two were straight forward and I have received my 25% lump sums and a monthly amount with no problems at all.
The third pension is a local authority pension that was still active because I was working and paying into it.
I had a projection forecast a year ago so I know what ball park I was roughly in.
There has been a lot of back and forwards between payroll and pension over the figures and lots of emails from me trying to push the whole thing along. God knows why as it all seemed quite straightforward to me.

In mid November the local authority pension provider confirmed they had all the info and figures they needed and as soon as the senior pensions officer had signed off the authorisation I would receive my pension pack to decide how I wished to access my pension.
I duly received the pack, read it carefully and signed all the necessary forms confirming that I wished to take the 25% and a monthly amount.
The figures were slightly better than the projection a year before but I expected that as I’d paid into it for another year plus the stock market has been strong so I expected some growth.

I returned the signed and dated forms, via tracked and signed delivery, having taken copies of each page for my records.
Today I have received another pension pack, no covering letter explaining why so I looked carefully through the pack to discover the figures have now changed and are significantly less than those in the first pack. They want me to fill out these new forms accepting the lesser amount with no explanation.
To say I am pissed off about this is an understatement!
They have spent four months sorting this out and now they appear to have given me the wrong figures.

My question is where do I stand, can I force them to honour the first set of figures that I agreed and signed for or do I now have to accept these recent figures which are quite a lot less?
Can anyone out there advise the best course of action?

Is it a final salary scheme or a normal money purchase pension? I assume money purchase and the market movements have reduced the value of your pension.

can you follow your tracking to confirm when it was received if so send that with proof of delivery and the copies of the completed forms to whatever email address they have and follow up with a phone call

Make a formal complaint then follow the complaints process through to ombudsman. Depending upon the regime it's either local government ombudsman or financial ombudsman

Thanks’PrincessofWells’
They have been unbelievably incompetent and I’ve been very patient.
I’ve emailed them this morning asking them when I will receive payment from the first Pension Pack I have received and that I have copies of all the forms I have signed and returned to them plus a tracking number confirming I have received it

Unfortunately if the second set of figures are right you probably won’t be able to force them to pay on the basis of the first set. This is a public sector scheme and most likely a defined benefit scheme so your benefits will depend on your length of service and salary. As public sector schemes have changed over time they can be quite difficult to get right and the departments who deal with them are probably under resourced and under trained.
I hear of many cases where nhs pensions are wrongly calculated and overpaid and even in those cases the money has to be recovered as it is paid by tax payers.

Unfortunately as pp said they are required by law to pay you the correct figures - you can’t force them to pay you incorrect figures.

The first step is to establish why they have written to you again and which set of figures is correct.

You can then decide if you want to take further action. There is a two step complaint process called the Internal Dispute Resultion Procedure. If you’re still not happy after that then you can go to the Ombudsman.

However as I said the ombudsman won’t force them to pay you incorrect figures, but you may get some compensation for maladministration depending on the sequence of events/who is at fault (it’s not clear if it’s the pension fund or your employer causing the issue).

Good luck.

By the way the stock market has no impact on benefits in the Local Government Pension Scheme. It’s a defined benefit scheme so your benefits are based on your service and pay. Your benefits are the same whether the underlying fund investments have done well or poorly.

Is it a DB pension?
Are you at the 'normal retirement age' for the scheme?
Was the quote you received for your actual current age?

You can't force them to pay out figures that were miscalculated.
The stock market won't have any impact if it's a DB pension.
However, if the revised quote is lower it's a very valid question WHY is it lower, and they ought to answer. Was it a mistake before, or is it a mistake now?

Thank you all for responding to me.
It’s a Defined Benefit scheme so I understand the stock market won’t impact it in the same way as my personal pension does.
I have retired early, at 60, and I understand the payments should reduced to take into account drawing on the pension for a longer period of time.
My issue is the difference in the first set of figures and then the second set of figures, sent a month apart.
I have lost faith in them to be honest as I just don’t trust them to now.

I have still not had a response to my email and no further correspondence explaining why I have been given two very different sets of figures.

I feel like I’m heading towards the Formal Complaint procedure unfortunately.

You should be able to log on and see what your figures are.

As others have said, the LGPS is not affected by the stock market (at least not directly) and there is a formula which dictates what you get. You will have a fairly significant reduction for accessing it early but you will have known about that.

Yes, I can log on and see my figures but they don’t correspond to anything I’ve received so far, it’s all very ‘smoke and mirrors!’
The Pension Packs have come through the post and each time contain pages and pages of figures.
I’d need to spend a week going through each and every pay slip to check what I’ve paid in and see if it correlates accordingly.
As they are supposed to be the experts I’d expect them to be able to achieve the correct figures first time, they know my age and that I was retiring early, none of it should be a surprise to them!

Do the figures you’ve received show any pay or service details? If so, do those look correct on either set of figures? That might help you work out which set is more likely to be correct.

It may be that your employer has sent through updated pay figures which meant they had to recalculate the benefits, but whatever the reason they should have explained that to you. Hopefully you can get an answer soon.

If it’s a DB scheme the amount you have paid in is not directly relevant to your benefits calculation. What matters is how long you have been paying in and what your salary has been.

Not sure why you would think you need to go through payslips to see what you paid in. That would tell you precisely nothing. The calculation is simple. 1/49 of your annual salary is added each year. Then an uplift for inflation is added each year. That is literally it. Unless you are talking about AVCs?

I’d need to spend a week going through each and every pay slip to check what I’ve paid in and see if it correlates accordingly.

For a DB scheme its not about what you've "contributed". That's notional.

Is it a career average scheme? Are the numbers to do with showing how your career average salary has been calculated, then working out your payments based on number of years worked?

It is not necessarily the case that any figures you have received are wrong.
For example, has the amount of early retirement reduction changed? etc etc
You just need to ask them why it has changed.

My guess is the two quotes had different parameters.
E.g. different dates draw started (say one at 60, one at 65), or different amount of tax free lump sum (PCLS in LG schemes), different end salaries... many possibilities.
Compare the two quote parameters before proceeding further OP.

Firstly thank you to everyone who has contributed to my pension conundrum.

I have now managed to speak to someone from the pension fund and it appears that an underpin calculation was made due to the McCloud judgement, which I was not entitled to.
They realised this, once I sent my initial signed forms back, and quickly recalculated it and sent me another pack hence the difference in amounts.
They failed to explain this in the second pack with the lower amounts and have now apologised for their error.
Unfortunately, I haven’t got any option other than to accept it but I’m pretty annoyed that an error on their part has caused an unexpected financial short fall for me.

You haven't actually got a shortfall if the original pack was miscalculated for whatever reason. I understand that you're disappointed but it seems like it was an error.

That's unfortunate but at least you know the right answer now and can take your pension without worrying it is incorrect.