By way of background, and for the Deputy’s information, it is important to note that at the time of the original introduction of spouses’ and children’s contributory pension (‘S&C’) schemes for male public servants and their subsequent extension to include female public servants, membership of the schemes was made automatic for new entrants, and optional for those who were in service at the time.
Revised S&C schemes introduced from 1984 onwards to cover a wider class of beneficiaries than in the original schemes, subject to more restrictive refund of contribution conditions, were applied automatically to new entrants while an option to join was made available to serving staff.
For a variety of reasons (including personal reasons), a number of serving public servants, both male and female, declined to join the revised and/or original S&C schemes. This was not confined to the Defence Forces, but was a public service-wide phenomenon.
The Commission on Public Service Pensions Pension in its Final Report (2000) examined a range of submissions that sought a new option to join the schemes but recommended against opening a further general membership option across the public service as a whole. The Commission was concerned about the major additional costs which a new option would impose, given that it would almost certainly be availed of by those who would either have an immediate entitlement or a high expectation of benefit at a later stage. A further option, the Commission argued, would weaken the integrity of the schemes, would lead to pressure for individuals to be permitted to enter and leave at will, and could undermine fundamentally the financing of the schemes, which operate on the insurance principle, i.e. that not everyone benefits.
However, the Pension Commission accepted that in a number of cases, perceptions of injustice might have arisen as a result of the exercise of past options not to join S&C schemes. For that reason, it recommended that a limited appeals process for scheme membership options be established to examine individual cases and to allow appeals that met any one of the following criteria:
‘(i) where there is no evidence that an option was provided to the individual public servant in the first place;
(ii) where there is medical evidence to indicate that the person making the decision not to join the scheme was of sufficiently unsound mind not to appreciate the consequences of his or her decision;
(iii) where a member of the original scheme declined to join the revised scheme in circumstances where there would have been no reasonably foreseeable adverse financial consequences for the individual (in terms only of his or her scheme contributions) had he or she instead opted to join the revised scheme.’
A comprehensive framework for addressing outstanding Pension Commission recommendations was agreed by a joint management-union Working Group and subsequently approved by the Government in 2004. Since then, the criteria recommended by the Pension Commission have been used in considering S&C scheme membership option appeals.
My information is that five appeal cases have been submitted to my Department under the Pension Commission limited appeals mechanism by the Department of Defence on behalf of spouses (or children) of deceased members of the Defence Forces, and that all five have been allowed, subject to complying with all of the requirements regarding qualification and payment of a spouse’s pension and children’s pensions under the relevant scheme rules, including the payment of any relevant outstanding member contributions.
I am satisfied with the operation of the S&C scheme membership option appeals mechanism. I consider that it is consistent with the Pension Commission’s analysis and recommendations on the issues involved (as I have outlined them above), and that both of these remain valid today.
