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Nicole Blackmore
'Watchdog has no grasp of pension-sharing rules'
Pensions adviser Richard Jacobs has accused the Pensions Ombudsman of having a “complete lack of understanding” of the rules governing pensionsharing.
In a letter to the ombudsman, Richard Jacobs Pension and Trustee Services managing director Jacobs says it was wrong to conclude in a recent decision that documents formally disclosed in court cannot be relied upon by a spouse.
Jacobs says that under disclosure of information regulations, members of pension schemes must disclose their pension credit to the court in the case of a divorce. The non-member spouse only has access to the disclosed information and is unable to seek clarification directly from the pension scheme.
Jacobs says one of his clients relied on a written statement from her husband’s pension scheme, disclosed in court, stating that her half of the pension credit could remain in the finalsalary scheme. But the pension scheme administrator later claimed that statement was made in error and that her share would not be kept in the scheme. The ombudsman ruled that the spouse could not rely on the statement because she is not the scheme member and therefore it was not addressed to her.
In the letter, Jacobs says: “I must bring to your attention what I feel to be a complete lack of understanding by your office of the rules, regulation and legislation concerning pension sharing. I am required to provide advice, often to both parties, as to how pensions can be shared.
“My grave concern is that your office is effectively stating that a spouse cannot rely on documents disclosed to a court. If this is correct, no one will be able to advise the spouse of a pension scheme member how to deal with the pension share until after the pension share has been agreed. This has to be nonsense.”
The Pensions Ombudsman refused to comment.
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Readers' comments (5)
David Trenner - Intelligent Pensions | 19 Aug 2010 3:16 pm
Spot on Richard! But given that most solicitors don't understand pension sharing why would you expect the Ombudsman to?!
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Julian Stevens | 19 Aug 2010 3:16 pm
I've never understood why there's a regulator for pensions matters separate from the FSA. If only the government would get on with the radical pensions simplification promised by the Conservative party in the run up to the election, this might be another cost burden on the industry that could be significantly reduced.
Then again, as it's funded by the industry and not from the national exchequer, there can be little hope of that, least of all with Mark Hoban involved.
Oh well, we can but dream of a better and less bureacratic society. How did it ever get this complicated?
Our lives are frittered away in detail. Simplify, simplify! [Henry D. Thoreau]
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Mr Manj | 19 Aug 2010 5:05 pm
Julian Stevens | 19 Aug 2010 3:16 pm
I've never understood why there's a regulator for pensions matters separate from the FSA. If only the government would get on with the radical pensions simplification promised by the Conservative party in the run up to the election, this might be another cost burden on the industry that could be significantly reduced.
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The Pensions Ombudsman is not a regulator. It is an Ombudsman. The Financial Ombudsman Service does not take on disputes about occupational pension schemes as they are not regulated by the FSA (i.e. they are not covered by the FSA handbook). Hence the existence of the Pensions Ombudsman
David - have to agree with you on solicitors. The number of solicitors who do not know basic things about pensions and divorce, like the fact that you can get pensoin sharing orders on SERPs/S2P, is scary.
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Incompetent Regulators Award Team | 20 Aug 2010 8:48 am
The word OMBUDSMAN covers up for a multitude of misleading thoughts. Here we go.
FOS = staff who are unqualified, inexperienced, some decision makers paid very little, given sales targets to complete complaint cases, ignore UK law, make up their own rules, don't understand their own and the FSA rules, arrogant, make big decisions on a whim, don't undertand financial services, been told to work for the consumer, received no evidence from claimants in nearly all cases etc etc....= recipe for disasterous and outrageous decisions.
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Anonymous | 15 Oct 2010 3:20 pm
My complaint about pension sharing was blocked by a senior investigator with the Pensions Ombudsman, Amongst many other indicators that he had no expertise in this area he questioned me on the meaning of the term "mode of discharge" which is used in the pension sharing regulations.
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