Swansea City County Pension Fund · CAS-45793-J6Y3

CAS-45793-J6Y3

Ombudsman’s Determination Applicant Mrs S

Scheme Swansea City & County Pension Fund (the Fund)

Respondent City & County of Swansea (the Council)

Complaint Summary

Summary of the Ombudsman’s Determination and reasons

Detailed Determination Material facts

The Council is the Administering Authority for the Fund. The Fund is part of the Local Government Pension Scheme. Mr S’ benefits were governed by the Local Government Pension Scheme Regulations 2013 (the 2013 Regulations). The 2013 Regulations gave the Council complete discretion on how the death grant could be distributed. Relevant extracts of the 2013 Regulations are set out in Appendix 1.

1 https://www.legislation.gov.uk/uksi/2013/2356/made

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“…invoice for funeral expenses paid…there are three children, the older two appear to be from [Mr S’] previous relationship. Although the youngest child is still living at home, I would be inclined to reimburse [Mrs S] for the funeral expenses and then share the remaining [death grant] between all four. – any will which may inform decision making?...[sic].”

“…the Pensions Panel has reached a decision with regards to the death grant which is payable from your late husband’s pension.

The decision is that it will be split between you and his 3 children…”

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Adjudicator’s Opinion

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2 Details of Case Law the Council referred to are set out in Appendix 3.

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Ombudsman’s Decision

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“DURING the Trust Period my Trustees shall not (subject to the Beneficiary’s reasonable compliance within the terms of (e) below) sell my House or the Contents except with the Beneficiary’s written consent but they shall sell my House or the Contents at the Beneficiary’s written request.” (Original emphasis).

“SUBJECT AS aforesaid and to the payment of my funeral administration and testamentary expense Inheritance tax and debts I give the residue of estate wheresoever and whatsoever to my said wife [Mrs S] absolutely…” (Original emphasis).

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15 CAS-45793-J6Y3 “At no point during our discussion did Mr S suggest that he wished to leave his cash, pension value or residue equally between his three children and Mrs S.”

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“the fact that the complainant did not complain that further inquiries should have been made underlines the fact that [the Adjudicator] substituted [her] own view of what the Council should have done”.

17 CAS-45793-J6Y3 Directions

Anthony Arter CBE

Deputy Pensions Ombudsman 13 February 2023

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“…

46.—(1) If a pensioner member dies before attaining the age of 75 an administering authority shall pay a death grant.

(2) The appropriate administering authority may, at its absolute discretion, pay the death grant to or for the benefit of the member’s nominee, personal representatives or any person appearing to the authority to have been a relative or dependent of the member…”

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The Will was discussed and it was confirmed that the Panel had based its initial decision concerning the distribution of the death grant on the contents of the Will.

They said that the Will was effectively saying that Mrs S could not sell the house and leave the money to anyone else and that she could continue to live there for her lifetime and, if, at the event of her death, the youngest son was still in full-time education, he could continue to live at the house until he completed his studies.

The proceeds from the sale of the house (after Mrs S’ death and allowing for the clause for the youngest son) would then be shared 30% to each of the sons and 10% to any grandchildren. The Will also states that funeral expenses were to be met from the estate.

It was on this basis that the Panel had agreed to pay the death grant equally to Mrs S and Mr S’ three sons. The reason behind the initial decision was that Mr S was in a second marriage. It was to protect the children from his previous relationship.

They discussed if the death grant formed part of the estate and if it were taxable. It was confirmed that it did not and that it was tax free.

They discussed that previously the death grant would have been paid through probate. However, this changed in 1997 when the Regulations allowed discretion.

They confirmed that Mr S’ three sons had not been contacted at the time. The process was that the Council sends a letter to the person who notifies it of the death. This letter includes a Claim Form, for the person to complete.

In this case, the completed Claim Form referred to Mr S’ three sons and other family members.

It appeared that Mr S thought the death grant would form part of his estate. There was no record that Mr S had ever completed a next of kin form.

Mr S may have assumed that as Mrs S would get a widow’s pension, she would also receive the death grant.

The Solicitor’s Letter was considered but it was noted that it was only the solicitor’s opinion.

They referred to the 2013 Regulations and said that it needed to be consistent in looking after all dependants.

20 CAS-45793-J6Y3 It was agreed that the Panel’s original decision should stand, and the death grant should be shared equally between Mrs S and Mr S’ three sons.

Mrs S would have the right to appeal under stage two of the IDRP.

It was agreed that the death grant would not be paid out at that time.

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R v Local Commissioner for Administration, ex parte Eastleigh Borough Council [1988] 1 QB 855 at 863E-F

CREEDNZ Inc v Governor General [1981] 1 NZLR 172

In re Findlay [1985] AC 318

Friends of the Earth v Secretary of State for Transport [2021] PTSR 190

R (Transport Action Network Ltd) v Secretary of State for Transport [2021] EWHC 2095 Admin

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