Civil Servants: Pensions

(asked on 7th December 2020) - View Source

Question to the Cabinet Office:

To ask the Chancellor of the Duchy of Lancaster and Minister for the Cabinet Office, with reference to overpaid pensions by civil service pension scheme administrator MyCSP in cases identified by the Internal Control Framework Review, what assessment has been made as to the (a) sums involved, and (b) cost-effectiveness of recovering those sums.


Answered by
Julia Lopez Portrait
Julia Lopez
Minister of State (Department for Science, Innovation and Technology)
This question was answered on 10th December 2020

Pension schemes are only allowed to make payments that are “authorised payments” (those payments that members are legitimately entitled to under the scheme).

Any other payments made from the scheme that are not ‘authorised’ are referred to as ‘unauthorised payments’ and are potentially subject to unauthorised payment tax charges of up to 55% for members and the scheme. In most cases, overpayments would be considered unauthorised payments if not recovered.

Any potential recovery is carefully considered, including the cost effectiveness of doing so (e.g. the relative costs of recovering very small amounts). Members have the opportunity to submit evidence should they believe that either recovery should not take place or where they might require a longer repayment plan. Members overpaid and identified by the Internal Controls Framework Review (ICFR) were treated in the same way as other members where overpayments had occurred as part of business as usual.

We do not have a separate record for the total value of pension underpayments under the ICFR as these formed the majority of the rectifications needed, and members received topped up pensions accordingly as part of business as usual activities, rather than as part of a separate project to recover any amounts due.

To date £20,610 has been paid in compensation awards through the Internal Dispute Resolution process to pensioners affected by overpayments identified during the ICFR.

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