Atos Uk 2019 Pension Scheme · CAS-101820-N8M6

CAS-101820-N8M6

Ombudsman’s Determination Applicant Ms N

Scheme Atos UK 2019 Pension Scheme (the Scheme)

Respondents Hymans Robertson LLP (Hymans)

Atos Pension Schemes Limited (the Trustee)

Outcome

Complaint summary

Background information, including submissions from the parties On 1 February 2022, Ms N telephoned Hymans to request a CETV for her Scheme benefits. She also explained that she intended to retire at the end of 2022.

On 7 February 2022, Ms N telephoned Hymans for an update on her CETV request.

On 9 February 2022, Hymans told Ms N that it had only recently taken over the administration of the Scheme. So, it was working on a considerable backlog of cases from the previous administrator.

On 22 February 2022, Ms N telephoned Hymans to follow up on her CETV request. She also submitted a complaint about the time taken to provide the CETV.

On 23 February 2022, Hymans acknowledged Ms N’s complaint and said that a response would be issued within 20 working days.

On 16 March 2022, Hymans referred Ms N’s CETV request to the Scheme Actuary to calculate.

1 CAS-101820-N8M6 On 17 March 2022, Hymans duly informed Ms N of the requirement to refer the calculation to the Actuary. It also said that the response to her complaint would be sent to her by 25 March 2022.

On 23 March 2022, the Scheme Actuary sent Hymans Ms N’s illustration of a CETV. Hymans telephoned Ms N and confirmed that the CETV was £1,244,480. It said that it would issue the corresponding paperwork shortly.

On 24 March 2022, Hymans emailed Ms N the illustration of a CETV of £1,244,480 (the March CETV). It explained that, as she was still an active member of the Scheme (and thus did not have a statutory transfer right), an ‘assumed’ leaving date of 31 March 2022 was used in the calculation. The accompanying notes section of the March CETV also said that it was not guaranteed.

On 20 April 2022, Ms N’s independent financial adviser (IFA) contacted Hymans to request retirement illustrations for immediate retirement, and up to her normal retirement age (NRA) of 65.

On 4 May 2022, Hymans sent the IFA the requested information; however, the retirement illustration and deferment updates were not provided as Ms N was still an active Scheme member.

On 19 May 2022, Ms N emailed her employer, Atos, to follow up on the IFA’s request for retirement illustrations.

On 2 June 2022, the IFA requested a copy of the Scheme booklet and the Scheme’s funding statement.

On 2 and 8 August 2022, the IFA emailed Hymans to request a new guaranteed CETV, and retirement illustrations for the current date, and up to Ms N’s NRA.

Between August and September 2022, Ms N, the IFA, and Hymans all corresponded with one another about the CETV and retirement illustrations requests. Ms N conveyed her frustration at the time taken to provide her and the IFA with the requested information.

On 31 August 2022, Ms N left the Scheme and her benefits were deferred.

On 29 September 2022, Hymans sent the IFA an immediate retirement illustration and an illustration calculated up to her NRA.

On 3 October 2022, the Scheme Actuary provided Hymans with a guaranteed CETV for Ms N.

On 4 October 2022, Hymans sent Ms N and the IFA the CETV of £833,720, (the October CETV). The guarantee date was effective for three months from 29 September 2022.

2 CAS-101820-N8M6 On 5 October 2022, Ms N emailed Hymans and highlighted the reduction in the October CETV compared to the March CETV (a reduction of £410,760). In response, Hymans informed Ms N that it would query the reduction with the Scheme Actuary.

On 12, 14 and 17 October 2022, Ms N emailed Hymans to follow up on the Actuary’s response about the CETV reduction.

On 17 October 2022, Hymans forwarded the Scheme Actuary’s response to Ms N. The Actuary said that the reduction in the CETV was driven by developments in market conditions, particularly the value of UK Government bonds and their yields. An assumption was made that the return on Scheme investments would increase, and so less funds were needed to meet the cost of future benefit payments. This resulted in a reduction in Ms N’s CETV, and applied to CETVs for the entire Scheme membership as and when requested. While less funds were needed to meet future payments, the value of the Scheme assets available to meet future payments had also reduced.

On 9 November 2022, Ms N raised a complaint under the Scheme’s internal dispute resolution procedure (IDRP). She provided a timeline of events and said that:-

• The communication from Hymans, in relation to requests made by her and the IFA, was poor and at times her calls/emails were not responded to.

• On 15 September 2022, she was told that the guaranteed CETV, requested by the IFA on 2 August 2022, would be available the following week. However, the CETV was not provided until 4 October 2022. Coincidently, this was after the mini- budget, delivered by the UK Government on 23 September 2022, which resulted in a negative reaction from world markets towards the UK’s increased borrowing.

• She began her retirement planning in February 2022. However, it had taken almost 10 months to receive the information the IFA required to help plan for her retirement. During this time there had been a lack of communication from Hymans and numerous delays. It took five months from May 2022 for Hymans to provide her and the IFA with retirement illustrations.

• The delays had caused a reduction in her CETV of £410,760. She was now no further forward with her retirement planning, despite wanting to retire at the end of 2022. During the 10 months she had needlessly suffered stress and anxiety resulting in health concerns. She had been financially disadvantaged by Hymans’ delays.

On 20 January 2023, the Secretary to the Trustee (the Secretary) provided his IDRP response to Ms N. He said that the Trustee did not agree that she had been “significantly disadvantaged financially” by any delays she experienced, nor was she prevented from implementing her retirement plans at the end of 2022. The Secretary said, in summary, that:-

Alleged financial detriment

3 CAS-101820-N8M6 • The March CETV made clear that it was not guaranteed, as she was still an active member of the Scheme. She could not reasonably rely on the March CETV as it was for illustrative purposes only.

• The October CETV was not affected by the repercussions of the mini-budget of 23 September 2022. The assumptions and factors from 1 September 2022 were used to calculate the October CETV, so they were effective prior to the mini- budget.

• The Scheme Actuary made clear that the difference between the March and October CETVs was due to movements in Government bonds and their yields over the course of 2022. Consequently, a lower amount was required to meet the cost of future benefits, so less money was required to fund transfer values causing a reduction. The reduction in the October CETV was consistent with reductions in other members’ CETVs at the time.

• The October CETV was provided within the three-month statutory time frame that Hymans was required to adhere to. The immediate retirement illustration, requested on 20 April 2022, was provided on 20 June 2022. The request for an illustration up to her NRA was requested on 8 August 2022 and provided on 29 September 2022. Both were provided within a two-month statutory window. Overall, she had not been financially disadvantaged.

Alleged delays between May and October 2022

• The IFA made clear, on 20 April 2022, and again on 30 May 2022, that an updated CETV was not required. A new CETV was only requested on 2 August 2022; however, at the time of the request, Ms N was still an active member of the Scheme. Ms N only became a deferred Scheme member on 31 August 2022, when she opted out. Any immediate or future retirement illustrations were provided within two months of being requested. Overall, there were no delays to consider between May and October 2022.

Alleged service delivery, communication and delays by Hymans

• It accepted that there were instances where Hymans did not manage its timescales accordingly, and updates on work being undertaken in the background were not communicated effectively.

• Due to the value of the March and October CETVs, it was necessary for the figures to be referred to the Scheme Actuary to check the accuracy of the calculations. This was in line with the Scheme’s established operating practices.

• It was unfortunate that Hymans had said, on two occasions, that she would receive the October CETV the week commencing 19 September 2022. While Hymans did take steps to manage her expectations it could have handled the situation better. It understood that this would have caused her distress and inconvenience during the “mini-budget” period. 4 CAS-101820-N8M6 • For the most part, the Trustee believed that Hymans took appropriate steps to ensure that Ms N was kept up to date on the progress of any information requests, Hymans also apologised for any delays when they occurred. There was no evidence of “constant delays” as she had claimed.

Decision

• The Trustee did not agree that she had been financially disadvantaged by any of the delays, nor was she prevented from putting a retirement plan into place by the end of 2022. It did accept that certain elements of Hymans’ service could have been better. Consequently, it offered her £750 in recognition of any distress and inconvenience she suffered.

Ms N’s position

Delays on the part of Hymans meant that the October CETV was not provided as early as it should have been. These delays also meant that the October CETV, in her view, was likely affected by the mini-budget announced on 23 September 2022, which caused a significantly negative reaction from global markets. She believed the delay was deliberate while Hymans and the Trustee awaited the outcome of the mini- budget before calculating any CETVs.

She understood that financial markets could fluctuate over the course of years; however, a reduction in her CETV of over £400,000 was “extraordinary”. This was the result of Hymans not providing the CETV by 19 September 2022 as it said it would.

When she submitted her IDRP complaint on 9 November 2022, she was told that she would receive a response by 23 December 2022. However, she was then told on 21 December 2022 that there would be a delay in the Trustee issuing its IDRP response. She received the IDRP response on 20 January 2023, a month later, after the close of business for the day. While the response was comprehensive, she was not confident in its investigation.

It was her intention to retire at the end of 2022. However, she was prevented from doing so due to the delays caused by Hymans, resulting in a significant reduction in her CETV entitlement. Consequently, she remained working beyond 2022 despite her intended plans.

She has suffered significant distress and inconvenience due to the actions of Hymans and the Trustee. The offer of £750 did not accurately reflect the financial loss she suffered.

Hymans & the Trustee’s position

As the value of each of Ms N’s CETV was in excess of £500,000, additional checks were required from the Scheme Actuary to ensure that the calculations undertaken were accurate.

5 CAS-101820-N8M6 Ms N was only eligible for a guaranteed CETV once she ceased active membership of the Scheme. The calculation of a CETV was based on the value of the accrued deferred pension, revalued up to the NRA. An assumption was then made on the life expectancy of the pension in payment, while factoring in yearly increases. This was done by making an assumption on the individuals life expectancy. The Scheme also provided a lifetime spousal benefit which was taken into account when calculating a CETV. All assumed payments were then aggregated together with an allowance for investment returns earned for the period between the effective date and date of pension payment to arrive at the CETV.

If the Scheme was expecting to receive greater investment returns in the future, then less funds were required to meet future benefits payments. This then had the effect of reducing CETVs as the cost of paying equivalent benefits reduced.

There was no dispute that Ms N was originally advised that she would receive an IDRP response by 23 December 2022. However, given the severity of the complaint, the Trustee wanted to ensure a robust investigation was undertaken. So, two days before the 23 December 2022 deadline, Ms N was informed of a new deadline of 20 January 2023. The response was issued in line with this new deadline.

There are no specific service level agreements between the Trustee and Hymans for the provision of a CETV beyond any statutory obligations.

In recognition of the poor service Ms N received from Hymans, the Trustee was prepared to increase its offer of £750 to £1,000.

Adjudicator’s Opinion

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Ms N did not accept the Adjudicator’s Opinion, and the complaint was passed to me to consider. Ms N provided her further comments which do not change the outcome. I agree with the Adjudicator’s Opinion and note the additional points raised by Ms N, which are:-

• She accepted that CETVs, by nature, could increase as well as decrease in value. However, the October CETV reduced by more than 30% compared to the March CETV, which in her view was excessive. Consequently, she was unable to retire at the time she wished to.

• She was told a number of times that the October CETV would be provided to her the week commencing 19 September 2022, but it was not, nor was she informed of why any delays had occurred. She believed that the October CETV was purposely delayed until after the September 2022 mini-budget, so that Hymans and the Trustee could assess the fiscal implications. Hymans had not provided any evidence of what caused the delay.

• Her complaint concerned the timing of the October CETV delays compared to the September 2022 mini budget. She was not disputing how the CETV was calculated. The March CETV was also reviewed by the Scheme Actuary; however, there was no delay until the calculation of the October CETV was undertaken.

• Ms N’s intention, in 2022, was to claim the CETV, and retire; however, after the significant reduction was revealed, she changed her plans accordingly. She has since elected to claim her pension and received tax-free lump sum with an annual pension.

Ombudsman’s decision

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1 “application” means an application for a statement of entitlement made under section 93A(1) of the 1993 Act (right to statement of entitlement: benefits other than money purchase). 2 Regulation 6(1)(a)

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I do not uphold Ms N’s complaint.

Dominic Harris

Pensions Ombudsman 10 March 2026

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