Nhs Pension Scheme · CAS-53208-T4X5

CAS-53208-T4X5

Ombudsman’s Determination Applicant Mrs H

Scheme NHS Pension Scheme (the Scheme)

Respondents NHS Business Services Authority (NHS BSA)

Winchmore Hill Medical Practice (Winchmore Hill Practice)

Outcome

Complaint summary

• NHS BSA initially claimed that her pension benefits had been overpaid by £940.89. It subsequently advised that the amount payable was £343.93.

• Winchmore Hill Practice should revise its calculations of her pensionable pay, so that it is consistent with the pensionable pay used in the calculation of the pension benefits that have allegedly been overpaid.

• The administrative errors Winchmore Hill Practice made in connection with her case amount to a breach of its duty of care and "Employer Obligations", as defined in the “Employers Charter”. NHS BSA has failed to hold Winchmore Hill Practice responsible for those breaches.

Background information, including submissions from the parties

1 CAS-53208-T4X5

Winchmore Hill Practice Park Lodge

2 CAS-53208-T4X5

3 CAS-53208-T4X5

• It had previously informed Mrs H that it had sent all the figures and spreadsheets to NHS BSA: NHS BSA had been asked to review the information. It had also asked its accountants to review the information and had attached the figures it had provided in connection with this.

• Staff at Park Lodge were on “very different” salary scales to the Winchmore Hill staff.

Winchmore Hill Practice

4 CAS-53208-T4X5

The complaint against NHS BSA

The complaint against Winchmore Hill Practice

5 CAS-53208-T4X5

•

changes submitted via the “Change of employment details form”, that are likely to affect a member’s benefits, will automatically trigger a task for NHS BSA to review the retirement award.

• NHS BSA acknowledged that it should have verified Mrs H’s notional WTE total pensionable pay. It has reminded its administrators that it is necessary to check that the employee’s pay is consistent with the pay notified in the annual updates.

• The Scheme Regulations do not require NHS BSA to check that pensionable pay meets the national minimum wage requirements. NHS BSA does not propose to implement this as an additional check.

6 CAS-53208-T4X5

• In this case, the administration arrangements for the Scheme are shared between NHS BSA and Winchmore Hill Practice’s payroll/pension department. Winchmore Hill Practice is responsible for recording, and submitting to NHS BSA electronically, the date a member commences and ceases pensionable employment and their pensionable pay for the year. Also, any changes to contracted hours from part-time to whole-time.

• Under Regulation U3 of the 1995 Regulations, the NHS employer is required to submit any revision to information previously submitted within one month. Mrs H may wish to contact Winchmore Hill Practice concerning the delays in submitting the AW171 form to NHS BSA.

• NHS BSA compiles and maintains a membership history from the data submitted by employers. This forms the basis of any benefit calculations NHS BSA undertakes in respect of the member. NHS BSA does not have direct access to pensions and payroll systems held by an employer. Consequently, it is not able to validate the information provided.

• NHS BSA’s “Stakeholder Engagement” team discovered that Mrs H had disputed the information provided in the AW171 form. In response, Winchmore Hill Practice submitted “multiple change forms.” The second AW171 form was submitted after a period of 18 months. According to its records, eight amendments in total were submitted over a two-year period. Mrs H should raise this with Winchmore Hill Practice.

• Winchmore Hill Practice informed NHS BSA that Mrs H’s pension record was created and updated by the previous practice owners and that it was finding it difficult to administer her record. NHS BSA provided advice to Winchmore Hill Practice on whether overtime was pensionable. Also, the standard hours that should be recorded, and how to calculate notional WTE total pensionable pay.

• The role of the employer under the Employer’s Charter forms “their legal requirement rather than a contractual requirement”. The Regulations that govern the Scheme only permits punitive measures in cases where an employer fails to pay the monthly contributions on time.

• When NHS BSA calculates a revised award of retirement benefits, a letter detailing any overpayment is automatically generated by NHS BSA. Recovery of the overpayment was put on hold pending the outcome of the investigation into Mrs H’s complaint.

’s position:-

• Winchmore Hill Practice was asked by Park Lodge and the local Clinical Commissioning Group (CCG) to provide support following a partnership dispute and a poor Care Quality Commission (CQC) inspection. As part of this process, the partners of Park Lodge stepped down and the partners of Winchmore Hill Practice took over the contract. 7 CAS-53208-T4X5

• Winchmore Hill Practice identified issues relating to payroll and pension practices at Park Lodge. This was highlighted to the CCG and the original partners at Park Lodge, and they instructed the third party to review the documents. The original partners then declined to continue with the services of the third party. Winchmore Hill Practice acknowledged that errors were made during the submission of Mrs H’s AW8 form. It had a duty as an employer to support Mrs H during the retirement process and was aware of its responsibilities in this matter. It has apologised to Mrs H for the errors made.

• It maintained open communications and arranged face to face meetings with Mrs H. It also communicated by email on a regular basis. It had very “open and transparent discussions” with Mrs H on 16 April and 31 May 2018. It explained that historic issues relating to Park Lodge had not been fully reviewed and that this was the responsibility of the previous partners.

• It also explained that it was happy to correct any errors identified to date and submit revised forms. Alternatively, wait until the full investigation of Park Lodge had been completed. Mrs H “explicitly” advised Winchmore Hill Practice to make a submission and include the erroneous information.

• Mrs H was informed that if additional errors were discovered, it would be happy to make further corrections as required and a revised AW171 form was subsequently submitted to NHS BSA. However, there was continuing confusion over the issue of overtime. There were also issues concerning the WTE hours. Although it had addressed the overtime issue with Mrs H, the Representative continued to raise queries, as historically Mrs H had been paid at a different rate for overtime compared to her base salary. Winchmore Hill Practice contacted NHS BSA regarding this. It reaffirmed that if the overtime rate was at a different rate to base salary, then it is not pensionable.

• In September 2018, Winchmore Hill Practice shared all the documentation that it had used for the pension calculations, in respect of the period 2015-2018, with Mrs H. In view of the errors made in previous submissions, Winchmore Hill Practice contacted its specialist medical accountants for support and provided all the documentation, including the AW8, AW171 and payroll data. The accountants shared the information with NHS BSA so that the matter could be resolved.

• It continued in its exchanges with NHS BSA, as there was an outstanding query concerning notional WTE hours. It confirmed to Mrs H that her WTE equivalent hours were 36 hours while she was working at Park Lodge.

• As part of its discussions during the transition period, Winchmore Hill Practice explained to staff at Park Lodge that they were on “very different salary scales” to the Winchmore Hill staff. It agreed that the Park Lodge salary scale would remain in force. However, the remaining terms of their employment contract would be in line with Winchmore Hill Practice. It acknowledged that it did not arrange for Mrs H to sign this amendment to her contract. Winchmore Hill Practice notified NHS BSA 8 CAS-53208-T4X5

that Mrs H’s WTE hours changed to 37.5 hours in April 2017. Due to the oversight in obtaining a signed amendment to Mrs H’s contract, Winchmore Hill Practice offered to amend her WTE to 36 hours on the revised forms. These were subsequently submitted in August 2019.

• Winchmore Hill Practice is satisfied that it sent Mrs H the documentation used to complete the pension forms. To ensure it provided accurate information, it sought assistance from its specialist medical accountants and consulted extensively with NHS BSA. It has been open and transparent with Mrs H in response to her concerns about discrepancies with her overtime rate. The issues relate to changes prior to its involvement; it is unable to rectify these.

• Winchmore Hill Practice reviewed its grievance procedure. It noted that the policy applied to grievances ongoing at the time the employee leaves the practice. Mrs H’s employment ended in January 2018. In any event, the grievance procedure entitles an employee to be accompanied at grievance hearings by a fellow employee, an employee appointed to act on behalf of other employees in negotiations with the Practice, or a trade union official.

Adjudicator’s Opinion

9 CAS-53208-T4X5

• The applicant’s circumstances must have changed detrimentally and irreversibly.

10 CAS-53208-T4X5

11 CAS-53208-T4X5

• Winchmore Hill Practice provide the detailed breakdown of the amount submitted to NHS BSA on 23 August 2019.

• Any “overtime” payments, which were paid at a rate lower than the “Basic Pay Hourly Rate,” should be recalculated and paid to Mrs H. They should also be included in the calculations of Mrs H’s retirement benefits.

• NHS BSA should write off the outstanding balance of £343.93, on the basis that Mrs H has a change of position defence to recovery of the overpayment.

12 CAS-53208-T4X5

Ombudsman’s decision I acknowledge that the Representative has raised wider issues concerning Practice’s payroll and NHS BSA’s administration of the Scheme. This Determination only deals with Mrs H’s complaint that was accepted for investigation. I am not considering any matters that fall outside the scope of that complaint.

Practice is not the original employer in this case. I agree with the Adjudicator that took an appropriate course of action by engaging an accounting firm to conduct a review and made submissions to NHS BSA.

It is not the role of TPO to question an employer’s choice of professional advisers, or otherwise. Similarly, it is not the role of TPO to independently audit information submitted on behalf of an employer. The fact that the Representative has expressed concerns regarding Winchmore Hill Practice’s choice of advisers, and the accuracy of its submissions to NHS BSA, is not a sufficient basis on which to direct a further review of information that has already been independently reviewed.

Winchmore Hill Practice and NHS BSA failed to show sufficient care in their handling of Mrs H’s case. The impact of their administrative errors is that Mrs H was overpaid and NHS BSA is now seeking to recover the sum of £343.93.

I am not persuaded on reviewing the evidence that Mrs H has a change of position defence to recovery of the overpayment. I find that she would have incurred .

Mrs H has undoubtedly sustained non-financial injustice because of maladministration on the part of the Winchmore Practice and NHS BSA. Given the number of errors I have increased the award to £1,500, in view of the severe distress and inconvenience that Mrs H has suffered over a prolonged period. I have split the award with NHS BSA directed to pay £500 and Winchmore Hill Practice £1,000.

The complaint is partly upheld.

Directions

Anthony Arter

Pensions Ombudsman 13 June 2022

13 CAS-53208-T4X5

Appendix The National Health Service Pension Scheme Regulations 1995

“U3 Accounts and actuarial reports

(1) The Secretary of State must keep accounts for the scheme in a form approved by the Treasury.

(2) The accounts are to be open to examination by the Comptroller and Auditor General.

(3) In respect of a member, an employing authority must keep a record of all—

(a) contributions paid under regulations D1, Q6 and Q8;

(b) contributions due under regulations D1, Q6 and Q8 but unpaid;

(c) contributions paid under regulation [D2];

(d) contributions due under regulation [D2] but unpaid;

(e) hours, half-days or sessions constituting part-time pensionable employment for the purposes of regulation R5;

(f) pensionable pay;

(g) absences from work referred to in regulations P1 and P2;

(h) commencement and termination of pensionable employment;

(i) reason for termination of pensionable employment.

(4) That record is to be in a manner approved by the Secretary of State.

(5) Except where the Secretary of State waives such requirement, an employing authority must provide the Secretary of State with a composite statement in respect of all scheme members covering all the matters referred to in paragraph (3) within 2 months of the end of a scheme year: this is subject to Schedule 2.

(6) Where an employing authority has provided the information in accordance with paragraph (5) and subsequently there is a change to any of that information, that employing authority must, within 1 month of the change, provide the Secretary of State with the revised information.

(7) In respect of each scheme year an employing authority must, within 2 months of a request and in a manner prescribed by the Secretary of State, provide the Secretary of State with details of the total contributions paid for all scheme members under regulations D1, D2, Q6 and Q8.

14 CAS-53208-T4X5

(8) Where an employing authority has provided the details requested in accordance with paragraph (7) and subsequently there is a change in those details, that employing authority must, within 1 month of the change, provide the Secretary of State with the revised details.

(9) [If the Secretary of State so requests,] an employing authority must, 1 month before the beginning of each scheme year, and in a manner prescribed the Secretary of State, provide the Secretary of State with a statement of estimated total contributions due under regulations D1, D2, Q6 and Q8 for that scheme year.”

15