Transcript APLI 15 December 2011

APLI
15 December 2011
Murphy’s Law Reaffirmed
(He hasn’t gone away, you know….)
A Few Statistics
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2003: 155 complaints received
2004: 297
2005: 389
2006: 439
2007: 515
2008: 758
2009: 636
2010: 589
And more…
Year to end November, 508
 Annual average 515 plus 950 phone/email cases where issues raised and
resolved
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And even more…
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Cases closed: 723 phone/email, plus 555
investigations.
Report and Guidance given: 203
Mediated: 146, 103 favoured complainant
OTOR: 76
Final determination: 74, 27 allowed
Other: 56
Public/private sectors: 30% / 70%
Cases on hand 30 November 2011: 430
Frequent Complaints
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Integration and the way it is applied
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When pay increase doesn’t exceed State Pension increases
FPS goes down, but historic contributions were on higher rates
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Contributions based on basic, benefits on pensionable
Final Pay
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e.g., three-year average for computing benefits but contributions
based on annual pay not averaged
Contributing for more than 40 years
Problems
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Failure to wind up promptly
AVCs not administered with main scheme
benefits
Public service AVCS – pensionable -v- actual
service
 NRD
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for lump sum calculation
Early Retirement – ill health and normal
 Deferred
beneficiaries given options previously
 Last-minute AVCs now locked in
 Retirement at 60 promised - promise not honoured
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Evidence proved intention – settlement reached
Public Sector Problems
Pension Levy (or pay cut)
 Reductions in pensions in payment
 Miscalculation
 Silly deadlines
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 Example:
HSE VER and VSS
17,000 estimates prepared
 4,000 detailed calculations
 Final exits: 2,005
 Meantime, “routine” work sidelined, ordinary
retirement payments delayed
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…. And More
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Spouses’ and Children’s contribution liability not
notified
Misclassification of employees as post-1995
“new entrants” for PRSI
 Liability for extra superannuation contributions
 No hope of recovering most of the overpaid PRSI
 Interdepartmental negotiations around 800 teachers
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Spouses and Children’s schemes – opters-out
and would-be opters in
 Change
of job or status
Injury Grants
Attempt by HSE to discontinue
automatically at age 65
 Circular sent by Employer umbrella body
 Statute says “shall be paid for life, or for
such shorter period….”
 No power to fetter discretion in advance
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Private Sector Problems
Pension Levy
 Section 50 applications
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 Consultation
a problem? – No regulations
made
Winding-up delays
 Unremitted contributions, as usual
 Refusal of Early Retirement
 Investment issues
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 Failure
to carry out instructions – or not…..!
And more…
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No trustee to wind up the scheme.. A common
problem
The lady who lived too long
D.I.S Benefit not protected – delay in payment –
loss of €43k
Declared Trustee investment policy not followed
– loss of AVC value
Employers who are own trustees don’t always
understand obligations or Pensions Act duties
CWPS Problems
Industry in ruins
 Vast amounts outstanding*
 Death Benefits not payable
 Criminal prosecutions successful but don’t
recover money in most cases
 Schemes of arrangement – post dated
cheques (many bounce)
 Ers not even liquidated…
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*11 determinations yesterday totalling €93k +
The Rise of the Phoenix
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Endemic in Construction
 New
firms, often same Directors, same
employees, take up old contracts
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Old firm owes Revenue, Redundancy, CWPS etc
N.I. Registered Company
 Operated
through RoI Branch
 Ceased to trade. I could not touch NI Company
 New Phoenix operation going Registered in RoI
 3 Complainants to make complaints to an Garda
in bid to obtain conviction and disqualification
OPO and the Law
Few appeals under S. 140
 Most – and most troublesome – brought
by the State
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 Afraid
of precedents
OPO now has enforcement of
determinations power formerly with
Minister
 One JR: “Conduct of Applicant throughout
the proceedings characterised by fraud
and deceit”
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Penalties
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16 District Court prosecutions in 2010 for failure
to provide information
 Appeals
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to Circuit Court
Costs €1300 to €2300
And we often get the information on the morning
the Court case is heard
Enforcement of requirement for information –
Circuit Court
Other issues
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Current issues include payment of benefits
under PAOs in Public Sector
 They
couldn’t make up their minds that there
was only one pension
 Arrears of overpayment
 Application of the USC
 Death in retirement is a huge issue – Family
Law Acts and drafting
Things We have Learned
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Public Service Admin is uneven
 Some
Departments centralise, some don’t
 Loss of expertise
 Reluctance of people to stay in
Superannuation Section
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Promotional criteria a problem here
 Specialist
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Staff means fewer problems
Need for recognition
At last, Shared Services!
Things we have learned, cont’d
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Investment – “proper investment”
Disinvestment of AVCs and DC in winding-up
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Amalgamation of (DC) AVCs with DB fund
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the trustee ever be right?
A considered decision, or just laziness?
“Having regard to the nature and duration of the
liabilities” is just a new way of saying something
very old
“Cooling-off” period and ARF
Employment Agencies and PRSA Obligations
It’s not all serious….
pensioned on all of his service – shortfall in
benefits
 Misinformation on transferred service – overstated
by 100 days - “loss” was €3.38 per fortnight
 PO cannot compensate for loss of expectation
 Civil servant missing pension credit for ONE day of
his service
 It was a strike day
 One man complained that trustees hadn’t told him
inflation would erode the value of his pension
 Not
It Really Isn’t
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Lady complained she had lost 2½% of her
pension
 She
 She
 She
insisted it be paid by cheque
liked to go to the Post Office
doesn’t trust ATMs
 Everyone else paid by EFT and got an increase of
2½%.......
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She didn’t understand basic arithmetic
 She
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had been a National Teacher
Another Complainant insisted on being paid by
cheque, then complained that compensation for
EFT not included in pensionable pay – he
understood, but claimed anyway
They haven't gone away….
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Complainant wanted average of allowance
going back 10 years to be pensioned
duties – allowances red circled until
new scale caught up
 Changed
Rules didn’t pension best 3 in last 10
 Complainant submitted Labour Court case in support
 Failed to submit his own Labour Court case by which
he had agreed to be bound
 Told him frivolous and vexatious –don’t write again
 Asked Scheme Administrator to write on his behalf!
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Questions?
Office of the Pensions Ombudsman
36 Upper Mount St, Dublin 2
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01 647 1650
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01 676 9577
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www.pensionsombudsman.ie
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[email protected]
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