NHS Pensions Agency v Beechinor 2

Reference: (1997) PLR 95

The complainant, Miss Beechinor, chose to join the NHS Pension Scheme on the basis of information provided by the administrators of that scheme in 1978. The administrators informed her of the opportunity to join the scheme by a letter dated 5 April 1978. The complainant subsequently wrote to the administrator seeking answers to five questions regarding the effect of such a transfer. The administrators replied to these questions but stated that they could not advise as to whether the decision to transfer into the NHS scheme would be correct. The complainant subsequently requested comparative estimates of the benefits under her current scheme and the NHS scheme. The administrators replied stating that they were unable to provide accurate estimates and repeated their statement that they could not provide advice as to the appropriate course of action which she should take.

Having decided to transfer into the NHS scheme, the complainant discovered on her retirement that she would have obtained significantly better benefits in her previous scheme. She made a complaint to the Ombudsman alleging injustice including financial loss as a result of maladministration by the administrators of the scheme stating that they did not supply adequate information concerning her pension entitlements and the options open to her.

The Ombudsman found that the appellants negligently failed to give a full explanation of the advantages and disadvantages of joining the NHS scheme. He ordered that the complainant's pension should be enhanced such that it equalled the pension to which she would have been entitled had she remained in her previous pension scheme.

By the time the appeal reached the High Court, the Ombudsman had conceded that his determination was deficient in a number of areas and should therefore be set aside. In particular, his direction that the complainant receive an enhanced pension was an invalid direction as it would be ultra vires for the appellants to pay such increased pension under the regulations governing the NHS scheme. In addition, the Ombudsman conceded that the administrator had no duty to advise the complainant. Lightman J held that, even if they had assumed such a duty, the information they provided was in fact correct and they could not be held to be guilty of maladministration.