Findings
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34. DSS have accepted that the leaflets they put out on retirement pension and widow's pension were incorrect in an important respect from the autumn of 1986 up to the spring of 1996. They have also accepted that most of their staff were unaware, up to the beginning of 1999, of the impending changes to the SERPS inheritance rules. Staff will therefore have given advice to enquirers solely on the basis of the current position at the time of the enquiry. DSS have not been able to give any satisfactory explanation of why that situation went unrectified for so long. I consider that the absence of any reference to the forthcoming change to the SERPS inheritance rules in the leaflets produced by DSS and then BA between September 1986 and April 1996 was a serious omission. Although the then Minister of State told Age Concern and Mr David Rendel MP in November 1998 (paragraphs 21 and 22) that the department had arranged publicity as part of the information on the Pensions Act 1995, DSS have since acknowledged (paragraph 15) that that information did not deal with the SERPS inheritance provisions. It was therefore misleading. It was not until the spring of 1996 that the main leaflets on retirement pensions and widows' benefits (leaflets NP45 and NP46) contained an appropriate reference. It was not enough that DSS publicity should state the then current position in describing SERPS inheritance entitlements, because the future change was one that would influence the actions of many pensioners and prospective pensioners in their financial planning if they knew of it. In a key respect the statements in the leaflets were incomplete, incorrect, and misleading. I strongly criticise DSS for failing to make their leaflets on retirement pensions and surviving spouses' benefits sufficiently comprehensive and up to date in this important respect following the enactment of the 1986 Act, and for their repeated failure to do so until spring 1996.
35. My staff's scrutiny of departmental papers and interviews with relevant DSS officials have produced no evidence that the fact that misleading information was given to the public stemmed from an attempt on DSS's part to conceal relevant facts or to mislead. What was involved was a simple oversight which has had very far-reaching consequences. That oversight was not picked up, because adequate management arrangements of a coherent and systematic kind were not in place to make sure that all the necessary administrative actions had been taken to secure the full and timely dissemination of the provisions in the highly complex 1986 Act. Nor have I found evidence of any mechanism which would provide such independent quality assurance of the legal, technical and presentational aspects of departmental publicity as was necessary to give effect to undertakings given by Ministers at the time about publicity for the legislation (paragraph 9). I have no doubt that the absence of such systematic procedures was one of the main causes of the subsequent problems.
36. It is also a matter of concern that even after the need to amend the leaflets was belatedly recognised in 1996, there was no immediate corresponding recognition that the fact that the leaflets up to that point had been wrong and misleading had widespread implications. For example, when in November 1996 Mr R pointed out that the information on inherited SERPS given in the 1996 editions of leaflets differed from that in earlier editions (paragraph 4), the reply which he has said he received was that the leaflets did not purport to give a definitive interpretation of the law, although it confirmed that the change in inheritance provisions was to take place in April 2000. That was an inadequate response to a justified query. Mr R's point was one that cried out as needing to be explored much more fully at the time.
37. DSS's maladministration over the leaflets was compounded by their failure to make sure that staff in local BA offices and at the pensions and overseas benefits directorate in Newcastle upon Tyne were properly informed of the forthcoming change and given appropriate guidance on how to deal with enquiries from the general public. That too was a serious error. Worse than that, the failure continued after the DSS leaflets had been put right in the spring of 1996, so that some staff were still giving inadequate and misleading responses to enquiries from the public up until April 1999. Even after the issue had been raised by Age Concern in late October 1998 and in Parliament the following month, it was not until mid-January 1999 that BA issued a bulletin to all staff drawing their attention to the forthcoming change in the SERPS inheritance provisions; and only in late February were staff briefed on the line to take when dealing with enquiries.
38. Why what did not happen did not happen is a matter of historic interest. Much more significant are the steps which the department have taken and are taking to ensure that past failings are not repeated, and how due redress for the thousands, and perhaps millions, of those who are at risk from those past failings is to be provided. On the first point, the Permanent Secretary has given assurances that action has been and is being taken (paragraph 28). What the department have been and are doing has been the subject of a NAO audit. While Parliament and the public are likely to want assurances that the. improvements promised will be delivered and maintained, there is no further point which I can usefully make.
39. On redress, section 52 of the 1999 Act provides an enabling mechanism for due redress to be given to the many who have sustained injustice as a result of the maladministration identified in this report. I have been given to understand by DSS that the Secretary of State for Social Security intends to make a statement to Parliament in the near future indicating how he proposes that the mechanism should be used. I have also been given to understand that in that statement he will propose
- that the date on which the halving of inheritable SERPS will take place should be postponed from 6 April 2000 until October 2002;
- that in the interim a scheme to provide redress for those who were misled by earlier advice, and suffered injustice as a consequence, should be introduced;
- that a wide range of those concerned with the subject, including me, should be consulted on the details of the scheme; and
- that after that consultation the details will be set out in regulations which will be the subject of affirmative resolution procedure under the 1999 Act.
40. If events take that course, it will naturally be for Parliament to decide whether whatever measures of redress are proposed by the Government are adequate. It seems to me that the contribution which I can most usefully make will be to offer my advice to Parliament on whether the proposed measures, once their details are known, are in principle capable of remedying the various categories of injustice consequent upon maladministration which my investigations have identified. It will still, of course, be open to Members to refer to me individual complaints to the effect that the scheme or its application has not provided an adequate remedy for the complaint.
41. At this stage, I shall therefore do no more than express the hope that any proposals will take account of what I told the Permanent Secretary about the onus of proof (paragraph 32). They will also need to take account of the fact that most of those misled by DSS or BA are likely as a result to have decided that no action on their part was needed, because they had been led to believe that a surviving spouse was secure in an entitlement to full inheritable SERPS. In view of that, it would be wrong to exclude from redress those who took no action; and the proposals will need to recognise that it will be difficult, and in some cases impossible, for claimants to demonstrate that they would have taken a particular course of action had they been correctly advised. The scheme should also, in my view, recognise that many people will have been misled solely by reading inaccurate leaflets, and will have received no further wrong advice, written or otherwise, from DSS or BA. They will need to be catered for in any proposals.
42. Finally, several of those whose complaints were referred to me made no suggestion that they had themselves received misleading or inadequate advice from DSS or BA or had been misled by the leaflets. Their complaint was rather that the changes in the 1986 Act were in themselves unfair. Complaints that the changes in the 1986 Act was unfair are not a matter for me. The content of legislation is a matter for Parliament.
M.S. Buckley
