Barloworld Uk Pension Scheme · CAS-30320-D2J5

CAS-30320-D2J5

Ombudsman’s Determination Applicant Mr L

Scheme Barloworld UK Pension Scheme (the Scheme)

Respondents Barloworld Pension Trust Limited (the Trustee) JLT Benefit Solutions Ltd (JLT)

Outcome

Complaint summary

• He was forced to defer taking an annual pension of £13,567.42, thus losing income for ten months from 1 July 2017 to 12 April 2018 of £11,306.18.

• He has calculated that adding 8% pa interest to the Cash Equivalent Transfer Value (CETV) figure in the original illustration for 10 months gives a figure of £17,847.93. He stated that, as the final CETV illustration was only £4,931 higher than the original, he has lost out on £12,916.93 interest that he could have earned.

• He was forced to encash other investments to maintain his income.

• He was forced to take a loan to replace his company car. He had purchased the car in May 2017, in the expectation of receiving benefits from the Scheme. He calculated that this, together with unplanned use of credit cards and bank overdrafts, resulted in a total additional cost to him of £983.

• He was forced to continue to work as he was not confident that he could retire due to the delay in getting details of his benefits from JLT.

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Background information, including submissions from the parties and timeline of events

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“…putting the complaint aside as we cannot properly assess the value of any damage at this stage until all processes have been completed”.

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• Benefits were quoted correctly to Mr L and all the information requested was provided.

• There were some unacceptable delays.

• It had recognised Mr L’s extra expense in taking out a loan in relation to the replacement of his Company car. This was reflected in its compensation offer which it confirmed still stood.

• It acknowledged that the late retirement pack that it had issued on 30 June 2017 was not sent within two months from it first receiving the request on 24 April 2017.

• It acknowledged delays in providing other information.

• It considered that the offer made by the Trustee on 16 January 2019 was reasonable.

Adjudicator’s Opinion

• The Adjudicator found no evidence of JLT making errors in the information that it provided. He went on to consider the delays in providing the initial CETV and late retirement illustrations and answering subsequent questions.

6 CAS-30320-D2J5 • The Adjudicator said that a late retirement illustration was requested by the Adviser on 24 April 2017 and issued on 30 June 2017. He noted that, as acknowledged by JLT, this was just outside the two-month window. The Adjudicator was satisfied that this was not an exceptional delay.

• The Adjudicator said that a CETV illustration was requested by the Adviser on 24 April 2017 and provided on 2 August 2017. He noted that this was a longer delay, partially due to the calculation having been with the Actuaries for over a month.

• The Adjudicator noted that, having requested the CETV and late retirement illustrations on 24 April 2017, by 2 August 2017, Mr L and the Adviser had received both packs. He appreciated that they then requested additional information that JLT was slow in providing. However, the Adjudicator was of the opinion that the two packs were adequate for Mr L to make an informed decision on his benefits had he felt that time was critical.

• The Adjudicator noted that the additional information, which was requested on 14 August 2017, was provided by 14 September 2017. At this point a further query was raised by the Adviser. From the information provided, the Adjudicator was of the view that all the outstanding queries had been responded to by 28 September 2017. Further questions were raised and responded to in January 2018. The Adjudicator was of the opinion that the Trustee and JLT could not be held responsible for the transfer to the SIPP not then taking place until 23 March 2018.

• The Adjudicator then considered the financial losses that Mr L said that he suffered as a result of delays caused by the Trustee and JLT:-

o The Adjudicator noted that Mr L had stated that he suffered a loss of income for ten months having been forced to defer taking his retirement benefits from 1 July 2017 until 12 April 2018. The Adjudicator was of the view Mr L had sufficient information to have made an informed decision by 2 August 2017, however, he chose not to do so. The Adjudicator found no evidence that Mr L was forced to defer taking his retirement benefits as a result of actions by the Trustee or JLT.

o Mr L submitted that he had lost out on £12,916.93 of interest that he could have earned but for the delays. To reach this figure he had added interest to the original CETV illustration and compared this to the difference between the two CETV illustrations. The Adjudicator was of the view that the 8% per annum interest figure used was over generous bearing in mind current investment returns. He said that using a more realistic interest rate would likely bring the two figures closer together. However, the Adjudicator was of the opinion that the correct calculation for loss would be to consider whether the value of the original lower CETV quoted would have been higher than the amount actually transferred at the date of transfer. The Adjudicator noted that Mr L had not suggested that to be the case.

7 CAS-30320-D2J5 o Mr L said that he was forced to encash other investments to maintain his income. While the Adjudicator understood that this might have been inconvenient for Mr L, the Adjudicator was of the view that Mr L had the option to make a benefit decision in August 2017 based on the contents of the two packs provided by JLT. So, he could have avoided the need to encash other investments.

o Conversely, Mr L also commented that he was forced to continue to work as he was not confident that he could retire due to the delay in getting details of his benefits. The Adjudicator noted that a late retirement quote was requested on 24 April 2017 and received by Mr L on 30 June 2017. While this was just outside the two months maximum period that the Adjudicator considered reasonable for such requests, he was of the view that it did provide the information that Mr L would have needed in this respect.

o In the opinion of the Adjudicator, the decision of when to continue working until was one that was in Mr L’s control. He was not financially disadvantaged by continuing to work or forced to do so.

o Mr L stated that he was forced to take a loan to replace his company car and that this, together with unplanned use of credit cards and bank overdrafts, resulted in a total cost £983. The Adjudicator noted that the Trustee had already offered Mr L a payment in respect of his costs in taking out an extra loan to cover the purchase of a car to replace his company car. The Adjudicator was of the opinion that the link to the usage of credit cards and bank loans was harder to make and he did not consider that any additional payment was required in this respect.

• Mr L highlighted the considerable stress and frustration that he has suffered. He also mentioned the time and effort that he and the Adviser have put into trying to resolve his case.

• The Adjudicator was of the view that some of the delays were unacceptable. He noted that the Trustee had already offered Mr L redress for non-financial injustice of £1,000, equating to the ‘serious’ level, as defined in the Factsheet. Mr L had stated that his case met all the criteria for being considered as ‘severe’ and some of the criteria for ‘exceptional’. However, the Adjudicator was not persuaded that this was the case as he had not seen evidence that there were numerous, repeated or compounded errors that would normally be used to justify a payment at this level.

• In summary, the Adjudicator said that, in his opinion, the amount of distress and inconvenience suffered by Mr L was not at the ‘severe’ or higher level. Nor, in his view, was financial reimbursement appropriate for the additional expenses that Mr L had identified, over and above that already offered by the Trustee.

Mr L did not accept the Adjudicator’s Opinion and the complaint was passed to me to consider. 8 CAS-30320-D2J5 Mr L provided his further comments which do not change the outcome. He said:-

• His initial request to JLT was dated 24th April 2017 and it took 11 months to get his benefits transferred to his SIPP.

• He and the Adviser had encountered significant delays, crucial errors and omissions when requesting information from JLT. As a result of the maladministration by JLT, he had suffered financial losses. He had also had to make personal financial arrangements that had been at a cost to him. JLT had acknowledged these delays and had made a number of apologies.

• The delays in transferring his Scheme benefits to the SIPP were out of the control of both him and the Adviser. He had made a calculation in November 2018 showing his potential loss of income from his SIPP due to the delayed transfer of his Scheme benefits as being £11,306.

• He had experienced a loss of interest from the delayed transfer of his benefits which he estimated to be £12,900.

• In relation to the CETV illustration requested on 24 April 2017, when it was provided by JLT it was wrong. It included factual errors in the calculation. The correct information was not provided until 28th September 2017.

• After receipt of the CETV illustration, the Adviser and TP had needed to request additional information from JLT, even though this information had been originally asked for. This information was required as TP did not have sufficient details to complete its analysis.

• JLT had falsely claimed that it did not have an LOA allowing it to release information to TP. However, this had been sent to it on 22 July 2014. Regardless of that, it could have been more proactive and sent the information that had been requested by TP to him or the Adviser.

• Due to the maladministration by JLT, the Adviser had to request a further CETV illustration. This was provided by JLT in January 2018.

• On 16 January 2018, he had made contact with the Scheme’s pension manager. She had said that she was appalled by the service he was receiving from JLT.

• The delays the Adviser was subjected to by JLT and the Trustee had to be managed by the Adviser in order to protect his professional relationship with TP. Once the Adviser was satisfied that he had the correct information to proceed, TP produced its analysis and the transfer of his benefits took place.

• JLT has deliberately tried to cover up its mistakes and shortcomings in its responses to his complaint.

I note the additional points raised by Mr L, but I agree with the Adjudicator’s Opinion.

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• The Adviser and TP asked JLT for information that JLT had already provided to Mr L in June 2017.

• Questions were being raised in relation to Mr L’s retirement benefits more than nine weeks after JLT had provided him with a late retirement illustration.

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I do not uphold Mr L’s complaint as a sufficient offer has been made by the Trustee.

Anthony Arter

Pensions Ombudsman 3 September 2021

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