The Pensions Ombudsman for Family Lawyers

Published: 21/11/2023 07:00

Status of the Pensions Ombudsman

The Pensions Ombudsman (TPO) is constituted under the Pension Schemes Act 1993 (PSA 1993).

TPO may investigate and determine any complaint made to them in writing by or on behalf of an authorised complainant who alleges that they have sustained injustice in consequence of maladministration in connection with any act or omission of the trustees or managers of an occupational pension scheme or personal pension scheme.

TPO may also investigate and determine any dispute of fact or law referred to them in writing by or on behalf of an authorised complainant which arises in relation to such a scheme between the trustees or managers of the scheme and an authorised complainant.

TPO also operates as the Pensions Protection Fund Ombudsman (constituted under the Finance Act 2004) which has a similar role in relation to issues relating to the Pensions Protection Fund.

TPO investigates more than 1,000 complaints per year, making detailed findings which are publicised, and which are open to appeal to a High Court Judge. The website of TPO ( exhibits full transcripts of all these decisions.

When might a family lawyer want to use TPO rather than apply back to court?

Once a properly executed pension sharing order (PSO) has taken effect, subject to any appeal out of time under s 40A Matrimonial Causes Act 1973 or a set aside application under FPR 9.9A, the task of the Family Court is usually complete.

Complaints relating to defective orders and pension sharing annexes or improperly served legal documents would be a matter for the Family Court to deal with. The Family Procedure Rules 2010 (SI 2010/2955) (FPR) 9.36(2), (4) and (7) set out the requirements for the Family Court or such party as directed by the court to serve the court order, Pension Sharing Annex and Decree Absolute/Final Order on the pension arrangements(s).

The implementation period is commenced by the parties submitting prescribed information to the pension arrangement and payment of any fee, if required. The implementation period cannot begin until the person responsible for the pension arrangement has received all its requirements in terms of information and payment of any fee.1 Most commonly, they would include completed discharge forms and receiving scheme warranties (paper or online), together with payment of charges by both parties (where appropriate). Once all the requirements are received the implementation period begins and this can last up to 4 months, unless there are grounds to delay or extend this period.2 The details of the scheme’s obligations are set out in Part IV Welfare Reform and Pensions Act 1999 and is supplemented by the Pension Sharing (Implementation and Discharge of Liability) Regulations 2000 (SI 2000/1053).

Assuming the correct legal documents have been served on the pension scheme, and those documents are properly drafted, it is the responsibility of the trustees of the pension scheme to implement the PSO once it is in receipt of all its requirements, through its appointed administrators. This can often be where delays occur because they will require notification from the transferee or their adviser of the scheme details to which the transfer is to be made, unless the option of an internal pension credit transfer is the only option (i.e. most public service schemes). Even then, forms often have to be completed to enable the implementation.

Thereafter, any concerns about the manner or timing of the implementation of the PSO would normally be raised with TPO, once the scheme’s own resolution processes have been exhausted. However, where a financial adviser is involved, they could first try to contact The Pensions Regulator, which may intervene more quickly and also has powers to impose fines on pension schemes for breaches. If the latter fails to resolve the problem, then it is most definitely a matter for TPO. In effect, complaints as to the manner and timing of implementation cease to be ‘family law’ matters and have become pure ‘pension law’ matters.

TPO is a free service for informal and formal dispute resolution decided according to legal principles. (Many other ombudsman services or other consumer-focused resolution services make decisions by reference to what is fair and reasonable, rather than legal principles.)

TPO’s power to determine disputes of fact and law is based in statute, primarily in s 146 PSA 1993. The scope of that power has been clarified over the years by the courts. It has been consistently held that, where a complaint or dispute has been referred to TPO, there should not be a different answer as to the substance of the dispute according to whether the dispute was decided by a court or by TPO: Wakelin & Ors v Read & Anor [2000] EWCA Civ 82.

TPO also has no power to direct remedial steps to be taken that are not steps that a court of law could properly have directed to be taken: Edge v Pensions Ombudsman [1998] Ch 512, Legal & General Assurance Society Ltd v CCA Stationery Ltd [2003] EWHC 2989 (Ch). Mr Justice Lewison, reviewing the previous authorities in Arjo Wiggins Ltd v Ralph [2009] EWHC 3198 (Ch) at [13], held that: ‘It is now well settled that, in principle, the Pensions Ombudsman must decide disputes in accordance with established legal principles rather than by reference to what he himself considers to be fair and reasonable’.

Following this line of authority TPO determines referred disputes impartially in accordance with legal principles. However, TPO powers differ in one key aspect. Since pure maladministration and consequential injustice (without infringement of legal rights) is not actionable in court, TPO is able to grant a measure of relief which the court could not. Typically, this is a modest sum directed as compensation for distress and inconvenience, and there is a factsheet describing these awards in more detail.3

A key distinguishing feature between TPO and the courts is that TPO is free to use. TPO generally does not award costs against the complainant, so can provide a low cost or cost-free impartial forum to resolve disputes. This can be achieved formally through adjudication, which can result in a legally binding determination on the parties, or informally through what is known as TPO ‘Early Resolution Service’. The vast majority of TPO complaints are fully dealt with on the papers.

What does a complainant need to do before they contact TPO?

In all cases, a party or their representative will need to have at least contacted the respondent pension arrangements first, setting out their complaint.

Before a complaint can be formally investigated via TPO adjudication, a complainant will need to have completed the pension arrangement’s Internal Dispute Resolution Process (IDRP), which registered pension arrangements must have. TPO has a factsheet which explains what must be done before it is prepared to become involved.4

What is the procedure before TPO?

Under s 149(4) PSA 1993, TPO’s procedure for conducting an investigation is such that it considers appropriate in the circumstances of the case.

Complaints need to be brought within 3 years.5

Broadly, a typical complaint procedure will be as follows, though a complaint may go through different stages as appropriate, and TPO’s procedures are subject to change:

  • The complaint will be assessed within TPO to ensure that it has been brought within time and is within TPO’s jurisdiction. See TPO online guide for further information.6
  • If the complaint is accepted, it may be recommended for the informal Early Resolution Service (if suitable) or for formal adjudication.
  • If recommended for early resolution, a resolution specialist will work with both parties to try to reach informal agreement. If an agreement cannot be reached, or if a party does not wish to continue with early resolution, the complaint may then be investigated formally by an adjudicator.
  • If recommended for investigation by an adjudicator (under delegated authority from TPO), the adjudicator will usually issue an Opinion setting out their view on the merits of the complaint and, if upheld, what steps should be taken by the respondent to put matters right.
  • If both parties accept the adjudicator’s Opinion or informal resolution, the complaint is closed.
  • If one or more parties do not accept the Opinion, the adjudicator will refer the complaint to TPO to consider and issue a binding decision. Under s 145(4C) PSA 1993, only TPO can determine a complaint. A final decision (known as Determination) by TPO is binding on the parties and can include directions and costs against the respondent.

What powers does TPO have?

These are set out principally in:

  • Part X PSA 1993;
  • the Personal and Occupational Pension Schemes (Pensions Ombudsman) (Procedure) Rules 1995 (SI 1995/1053) (1995 Procedure Rules); and
  • the Personal and Occupational Pension Schemes (Pensions Ombudsman) Regulations 1996 (SI 1996/2475).

Broadly, these include investigating and determining disputes of fact and law, and complaints of maladministration, in relation to occupational or personal pension schemes, which arise between a person responsible for the management of the scheme, and a beneficiary. TPO has the power to summon witnesses and order disclosure of documents in the same way as a court would be able to do.

Substantively, TPO has the very wide power to order pension arrangements to take or refrain from taking particular steps.7 Awards of damages for financial loss can be made. TPO can also make awards in recognition of non-financial injustice, which is set out in more detail in a TPO factsheet.3

How does a determination come about – is there ever a hearing or is it all on papers?

The vast majority of cases can be fully dealt with on the papers. As part of a formal investigation, any party to a complaint can ask TPO to hold an oral hearing. However, it is TPO’s decision whether to hold one, and he may also decide to hold an oral hearing even if one is not requested. TPO may call an oral hearing at any time. The circumstances in which a hearing may be appropriate include:

  • Where there are differing accounts of a particular event and the credibility of witnesses needs to be tested.
  • Where the integrity or honesty of one of the parties has been questioned, and that person has asked for an oral hearing.
  • Where there is a dispute about basic facts that cannot be uncovered by the investigation on the papers.

If TPO does decide to hold an oral hearing, rr 10–15A 1995 Procedure Rules govern the conduct of these hearings.

What is the status of TPO decisions – do they create precedents in a legal sense or do they tend to get followed informally?

Determinations are binding on the parties. They are not binding on third parties and do not create precedents that bind future Determinations by the same or future TPO. Given that Determinations are made in accordance with legal principles, and by TPO with the support of TPO office, it is expected that there will generally be consistency across different Determinations.

Can you appeal TPO decisions?

Under s 150 PSA 1993, a party in England and Wales may appeal a Determination on a point of law to the High Court. A party based in Scotland may appeal a Determination on a point of law by way of case stated to the Court of Session and a party based in Northern Ireland to the Court of Appeal in Northern Ireland. The appeal route for other decisions by TPO or those delegated to their staff (e.g. of jurisdiction decisions or discontinuance notices) is by way of judicial review.

What kinds of decisions does TPO make about pensions on divorce

All TPO decisions are published on the website of TPO.9 There follows a chronological schedule of all known decisions made by TPO which relate to pensions on divorce.10

There are several recurring themes to be found in the reported decisions. Points which tend to crop up regularly include:

  • Claw backs made by a pension arrangement for benefits paid to the pension holder, when the pension is in payment, after the PSO has taken effect but before the share has been implemented. Family lawyers should ensure that they understand this point and alert their clients to its ramifications. Good examples of this are the cases of Shepherd (case 1, below) and Cleworth (case 19, below).
  • Transfers made out of pension prior to implementation. Good examples of this are the cases of Morton (case 9, below) and Mr S (case 56, below).
  • Scheme administration errors, for which see Mr A (case 45, below).
  • Revaluation of a pension debit for active members of defined benefit pension schemes, for which see Mr N (case 49. below).
  • What benefits will be deemed to be within a public sector scheme at point of implementation for members close to retirement, for which see Culverwell (case 17, below).11
  • Moving Target Syndrome (MTS) or uncertainty over the cash equivalent transfer value (CE), for which see Mr R (case 57, below).

The family practitioner wanting to understand better the workings of TPO so far as it relates to family law would do well to consider the above cited cases as leading examples.

The Pensions Ombudsman divorce case decisions12

 CaseMonth/YearCase numberNature of complaint
1Shepherd v Air Products Pension Plan9/2006Q00278Clawback
2Cowland v Capita SIPP4/2007Q00244Incorrect CE and split basis
3Pike v Teachers Pension Scheme3/200826355Clawback
4Crabtree v BAE Systems EPS5/2008S00522Valuation (MTS)
5Slattery v AFPS8/200827870/1Revaluation of pension debit and what it applies to
6Kerbel v Southwark Council1/200972577/1Retirement date
7Mr S J McGurk v Royal Mail 7/200974946/2Death benefit distribution
8Boughton v Punter Southall & Bell and Clements Group Pension9/200974851/1Speed of implementation
9Morton v MJF Associates Private Pension Scheme7/201077828/2Lump sum death benefits
10Kemp v Axle Group Directors & Executives Pension Scheme9/201076194/1Lump sum death benefits
11Mrs A Ioannou v Aviva Life Services12/201075645/2Estate reduction
12Symons v Astra Zeneca Pension Trustees Ltd7/201183880/2Lump sum death benefits
13Davis v Windsor Life Assurance3/201280998/1Valuation (MTS) – incorrect judgment?
14Hendry v The Tarmac UK Pension Scheme3/201285218/1Lump sum death benefits
15Staley v Marlborough Investment Mgt Ltd Retirement Scheme7/201281482/2Valuation (MTS)
16Ms S v Alliance Trust Pensions SIPP7/201283083/2Transfer delay
17Culverwell v Teachers Pension Scheme11/201282981/3Valuation (what is included)
18Miss Stocks v Hornbuckle Mitchell11/201284269/1Non-implementation
19Cleworth v Teachers Pension Scheme12/201287725/2Clawback
20Collinson v NHS Pension Scheme3/2013PO-128Clawback
21McNicholas v Scottish Widows4/2013PO-408Repayment of overpaid CE
22Payne v AON and Anglo UK Pension Trustees5/2013PO-107Incorrect ret. calcs. post-PSO
23Adams v Innovene Trustees9/2013PO-823Incorrect CE
24Morton v Royal London (Scottish Life)8/2013PO-378Scheme transferred before implementation
25Mr Emson v Teachers Pension Scheme9/2013PO-168Clawback
26Mrs Gordon-Smith v Veterans UK11/2014PO-3618Benefit valuation
27Mr H v Veterans UK6/2016PO-7888Clawback
28Ms O v BT Pension Scheme Trustees6/2016PO-6385Incorrect information
29Ms D v NHS Pensions7/2016PO-9150Incorrect normal retirement date quoted
30Mrs N v Lloyds Bank Pension Scheme1/2017PO-6972Delays and reduced CE
31Mrs N v BAE Pension Scheme2/2017PO-7696Death benefits pre-divorce
32Mrs Y v USS3/2017PO-15209Wrong info + valuation (MTS)
33Mrs T v Rowanmoor6/2017PO-8797Scheme asset failings
34Mr N v HSBC (UK) 6/2017PO-16288Implementation charges
35Mr N v PCSPS8/2017PO-16419Clawback
36Mr S v PCSPS9/2017PO-3942Clawback
37Mrs R v Teachers Pension Scheme12/2017PO-15686Costs incurred by delayed CE
38Mr D v Hertfordshire CC (LGPS)01/2018PO-16922Clawback
39Ms Y v Alexander Chapel Associates03/2018PO-1196Failure to implement PSO
40Mrs N v Mr Y07/2018PO-7505Failure to implement PSO
41Mr Y v Friends Life 07/2018PO-5645PSO incorrectly implemented
42Mrs s v JLT (Indesit Company UK) 10/2018PO-15486Overstated CE
43Mr N v Mercer (MMC UK Pension) 11/2018PO-18613Wrong PSO calculation (minor)
44Mr E v Teachers Pensions11/2018PO-21001Clawback
45Mr A v KPMG (Rettig UK Pension) 11/2018PO-19073Wrong interpretation of annex
46Mr Y v RPMI (Railways)03/2019PO-22071Attachment maladministration
47Mrs N v Aviva03/2019PO-22362Change in valuation (MTS) + maladministration
48Ms S v Trinity RBS03/2019PO-22064Change in valuation (MTS)
49Mr N v Veterans UK (AFPS)10/2019PO-23859Revaluation of pension debit
50Ms N v MyCSP10/2019PO-23696Retirement benefits and timing of PSO
51Mr R v JLT (The Stena UK 2016 RBS)10/2019PO-21046Attachment Orders (effect of 2006 A Day changes to rules)
52Mr Y v Police Pension Scheme06/2020PO-21875Clawback with compensation
53Mr H v London Clubs Ltd Pension Scheme12/2020PO-28860Scheme errors
54Dr N v Teachers’ Pension Scheme03/2021PO-23533Clawback
55Mr S v Aviva Pension Plan04/2021CAS-42431-G2M7Misinterpretation of Consent Order – incorrect entitlement
56Mr S v The Ryland Group PS03/2022CAS-31053-J5J5Scheme transferred before implementation
57Mr R v Compass Group Pension Plan06/2022CAS-43151-ROL7Change in valuation (MTS)
58Mr E v [H] Computer Systems 07/2022CAS-44039-Y6Q2Implementation delays – H&W remained small self-administered scheme managing trustees
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