View more on these topics

You should have taken advice is DWP’s defence

by James Salmon

The Government will argue in court that the 125,00 pensioners who lost their final-salary schemes should have taken financial advice rather than rely on Department for Work and Pensions’ leaflets.

But pension campaigner Ros Altmann has branded the defence as “nonsense”. She says the Government and the FSA compared “guaranteed” occupational schemes against private pensions at the mercy of the stockmarket and failed to encourage scheme members of trustees to seek professional advice.

The Government was hauled in front of a High Court judge on Tuesday after failing to submit evidence on time in the £3bn legal challenge.

Lawyers for the pensioners Binderman & Partners argued that the Government had effectively disqualified itself from the case by failing to respond to the legal challenge within 35 days, as required by law.

But Mr Justice Collins, who will conduct the judicial review into whether the Department for Work and Pensions was guilty of maladministration, allowed the defence.

Judge Collins said: “Things have been brought to a head with a slight judicial kick. For future reference, it must be borne in mind that proper procedures should be followed. “

The judge ordered the Government to pay the costs for the hearing and extended the deadline for the pensioners’ lawyers to submit their skeleton argument.

Altmann, who is head of the Pension Action Group which is backing the pensioners, says: “The Parliamentary Ombudsman has clearly explained that material such as leaflets are flawed and unacceptable and the DWP is seemingly oblivious to the standards of behaviour that financial companies and advisers have had to live by for many years. If advisers and companies imply safety where there is none, they have to compensate in full. Yet the Government believes it has no such obligation at all.”

She adds that the Government is abusing its power and has failed to give a satisfactory explanation for the additional delay. She says: “This sums up the appalling way that the Government has treated these pensioners.”

The Government is accused of wrongly assuring the pensioners that their schemes were safe, protected by law, or even “guaranteed.” The independent Parliamentary Ombudsman report supported this view but the Government has refused to pay compensation.

John Halford, a partner at Binderman & Partners, says: “The Government has an arrogant attitude that it can do what it wants and it does not matter what the court or the ombudsman says. It has broken court rules and ignored specific instructions given by the judge.”


Parallel lines

It is tricky writing this piece when I know that by the time you read this we will have had an important announcement that I might have liked to comment on. This week it is the pre-Budget report.

Rules of residence

Residence, ordinary residence and domicile come in for attention in light of the Gaines-Cooper case

Changes to early exit pension charges

In November last year, the FCA announced that from 31 March 2017, early exit pension charges will be capped at 1% for those customers who are eligible to access their retirement savings from age of 55. The rules also state that for new personal pension plans started after that date, or on new increments into […]


News and expert analysis straight to your inbox

Sign up


    Leave a comment


    Why register with Money Marketing ?

    Providing trusted insight for professional advisers.  Since 1985 Money Marketing has helped promote and analyse the financial adviser community in the UK and continues to be the trusted industry brand for independent insight and advice.

    News & analysis delivered directly to your inbox
    Register today to receive our range of news alerts including daily and weekly briefings

    Money Marketing Events
    Be the first to hear about our industry leading conferences, awards, roundtables and more.

    Research and insight
    Take part in and see the results of Money Marketing's flagship investigations into industry trends.

    Have your say
    Only registered users can post comments. As the voice of the adviser community, our content generates robust debate. Sign up today and make your voice heard.

    Register now

    Having problems?

    Contact us on +44 (0)20 7292 3712

    Lines are open Monday to Friday 9:00am -5.00pm