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England and Wales High Court (Administrative Court) Decisions |
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You are here: BAILII >> Databases >> England and Wales High Court (Administrative Court) Decisions >> Government Actuaries Department v Pensions Ombudsman [2012] EWHC 1796 (Admin) (15 June 2012) URL: http://www.bailii.org/ew/cases/EWHC/Admin/2012/1796.html Cite as: [2012] EWHC 1796 (Admin) |
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QUEEN'S BENCH DIVISION
THE ADMINISTRATIVE COURT
Strand London WC2A 2LL |
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B e f o r e :
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GOVERNMENT ACTUARIES DEPARTMENT | Appellant | |
v | ||
PENSIONS OMBUDSMAN | Respondent |
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WordWave International Limited
A Merrill Communications Company
165 Fleet Street London EC4A 2DY
Tel No: 020 7404 1400 Fax No: 020 7404 1424
(Official Shorthand Writers to the Court)
Mr J Evans (Mr T Roscoe at judgment)(instructed by the Pensions Ombudsman) appeared on behalf of the Respondent
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HTML VERSION OF JUDGMENT
Crown Copyright ©
The statutory provisions
"The lump sum is the actuarial equivalent of the commuted portion at the date of retirement calculated from tables prepared by the Government Actuary."
"The majority of GAD's duties under the FPS consist of preparing, and revising from time to time, tables that the scheme administrators can use to calculate various actuarial values."
"105. Whilst it is correct that there is an express obligation only on police authorities to use the tables prepared in calculating the lump sum, the Regulation clearly contemplates that there is a duty to prepare tables, to enable that lump sum to be calculated correctly and paid. Since the actuarial equivalent is liable to change over time, a judgment must be exercised periodically as to whether to revise the existing tables, to ensure that the tables to be used in calculating actuarial equivalence do in fact enable equivalence to be achieved in respect of any surrendered portion. That judgment calls for an entirely actuarial expertise and is to be exercised only by the Government Actuary. There is therefore an implied obligation upon the Government Actuary to prepare tables and, if necessary, to review and revise them, because they are needed to enable the police authorities to comply with their express obligation to use them, i.e. to make the provision work (see Padfield v Ministry of Agriculture Fisheries and Food [1968] AC 997.)
106. There is therefore an implied obligation upon the Government Actuary to identify those factors which will, in his/her judgment, give the actuarial equivalent for each officer who elects to commute and serves the notice. As the evidence shows, it is the changes in actuarial conditions (mortality assumptions and discount rates) which may lead the Government Actuary to review and revise the tables from time to time, in order to comply with this implied obligation. Whilst it is correct that Parliament has not specified the time which is to elapse between reviews, such express provision is in my view unnecessary. The express requirement in B7(7) that the tables must be such as enable a police authority to calculate a lump sum which is the actuarial equivalent of the surrendered portion is sufficient to enable the Government Actuary to determine whether, at any given time, changes are required to existing tables to enable police authorities to fulfil that obligation."
"(4) Regulations may provide that, subject to any prescribed modifications or exceptions, this Part shall apply in the case of an occupational or personal pension scheme in relation to any prescribed person or body of persons where the person or body—
(a) is not a trustee or manager or employer, but
(b) is concerned with the financing or administration of, or the provision of benefits under, the scheme
as if for the purposes of this Part he were a person responsible for the management of the scheme."
"(4A) For the purposes of subsection (4) a person or body of persons is concerned with the administration of an occupational or personal pension scheme where the person or body is responsible for carrying out an act of administration concerned with the scheme."
"...any person concerned with the administration of the scheme, other than a person responsible for the management of the scheme (as defined in section 146(3) of the 1993 Act for the purposes of Part X of that Act)."
It is trustees, managers and the employer who are defined as the persons responsible.
"The work done by a solicitor may vary considerably from case to case. He may be engaged to perform tasks which are connected with the running of the affairs of his principal. It is, as counsel rightly submitted, a matter of fact and degree, depending on the terms of the solicitor's retainer. Where he is simply instructed to write a letter of claim to a debtor he is acting as the agent of the principal in carrying out his instructions. We do not consider that it can be said that in these circumstances he is concerned with the administration of the affairs of the principal. Arthur Cox were in that position. They were merely instructed to seek recovery of certain sums of money from the respondent, and wrote a letter of claim accordingly. In our view this cannot be said to have been 'concerned with the administration of the scheme', and the Ombudsman was in error in so holding."
This could not be said to be concerned with the administration of the scheme.
"This is a question which focuses on the role of the Claimants in complying with the instructions and what and whose affairs the Claimants were administering. In my view the Claimants are correct when they say that 'administering the Scheme' means (in whole or in part) running the Scheme, e.g. inviting employees to join, keeping records of members, communicating with members, calculating benefits, providing benefit statements, paying benefits when due, keeping documentation up to date, dealing with governmental or regulatory agencies (Inland Revenue, DWP, OPRA) etc. In the case of a funded scheme, it will also no doubt involve running the fund, investing and managing the Scheme's assets. The ultimate responsibility for all these acts will usually lie with the trustees, but: (1) if someone else carries out the day-to-day running on their behalf that person may be a manager; (2) if someone is otherwise involved with an act of administration for the trustees (whether by carrying out such an act or advising on it) that person may be concerned with the administration of the scheme. But the touchstone is whether he is engaged to act, or advise, in or about the trustees' affairs in running the Scheme."
"We accept, of course, that those activities, whether carried out by BULA or by BIM, are administrative in nature; and that they are administrative activities which may be described as being carried out in connection with this Scheme. But the relevant question is not whether a person carries out of administrative activities in connection with a scheme; the relevant question is whether the person is 'concerned with the administration of the scheme'. An insurance company which does no more than administer its own assets and calculate, from time to time, the amount which it is liable to pay under a unit linked policy which it has issued is in much the same position as the trustees' bankers or any other depository. It is no more concerned with the administration of the scheme than others who have contracted to make payments to the trustees or the scheme beneficiaries on request or demand. As we have said, it is significant that the ombudsman's powers to investigate and determine under Part X of the 1993 Act have not been extended to those concerned only with the financing of, or the provision of benefits under, a scheme."
The Pensions Ombudsman's decision
The issues
Conclusions
"On the second question the parties are at odds as to the proper function of the courts. The respondents say that the two stages of the commission's enquiry involved wholly different tasks. Once the commission reached the stage of deciding on public interest and remedies it was exercising a broad judgment whose outcome could be overturned only on the ground of irrationality. The question of jurisdiction, by contrast, is a hard-edged question. There is no room for legitimate disagreement. Either the commission had jurisdiction or it had not. The fact that it is quite hard to discover the meaning of section 64(3) makes no difference. It does have a correct meaning, and one meaning alone; and once this is ascertained a correct application of it to the facts of the case will always yield the same answer. If the commission has reached a different answer it is wrong, and the court can and must intervene.
I agree with this argument in part, but only in part. Once the criterion for a judgment has been properly understood, the fact that it was formerly part of a range of possible criteria from which it was difficult to choose and on which opinions might legitimately differ becomes a matter of history. The judgment now proceeds unequivocally on the basis of the criterion as ascertained. So far, no room for controversy. But this clear-cut approach cannot be applied to every case, for the criterion so established may itself be so imprecise that different decision-makers, each acting rationally, might reach differing conclusions when applying it to the facts of a given case. In such a case the court is entitled to substitute its own opinion for that of the person to whom the decision has been entrusted only if the decision is so aberrant that it cannot be classed as rational: Edwards v Bairstow [1956] AC 14. The present is such a case. Even after eliminating inappropriate senses of "substantial" one is still left with a meaning broad enough to call for the exercise of judgment rather than an exact quantitative measurement."
(Handed). Yes.