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ITEM PF17
PENSION
FUND COMMITTEE – 26 AUGUST 2005
PAYMENT
OF DEATH BENEFIT
Report by
Head of Finance and Procurement
Introduction
- The Local Government
Pension Scheme (LGPS) Regulations state that if a member dies, the administering
authority has absolute discretion to make payments to or for the benefit
of the member's nominee or personal representatives or to any person
appearing to the authority to have been her/his relative or dependant
at any time. The Regulations also state that if the administering authority
has not made payments equalling in aggregate the member’s death grant
before the expiry of the 2-year period, it must pay the shortfall to
the member’s personal representatives.
- Since 1998 Pension
Services have asked members to complete expression of wish forms identifying
beneficiaries so that payment of the death grant can be made quickly
and in accordance with their wishes. Scheme members are encouraged to
keep their nominations up to date.
- In the event of
a death, where no expression of wish form has been completed, Pension
Services have asked for copies of the letters of administration or probate
to be able to determine who is the executor of the estate.
- Pension Services
have also requested copies of the letters of administration or probate
to determine who has been granted a legal responsibility for administering
the deceased’s affairs in the event of any part payment being outstanding
for two years after the date of death.
Contested
Payment
- An employee retired
from one of the participating authorities to the Fund on the grounds
of ill health in April 2004 and subsequently died in June 2004. She
had completed an expression of wish form nominating her daughter as
her only beneficiary. Since her family had not contacted Pension Services,
Pension Services advised the administrators that a small death grant
is payable (£551) to her daughter. Her daughter now lives abroad in
the care of her father and receives a child’s pension from the Oxfordshire
Pension Fund.
- The administrators
of the Estate then advised Pension Services that she had a son and they
wished to clarify whether the payment of the death grant would be split
between her son and daughter, or payable solely to her daughter as per
the nomination form. This was to be discussed at a meeting with her
sister and son to ascertain whether they accepted that payment of the
death grant should be made solely to her daughter since her daughter
is not named on the grant of probate and will not benefit should the
death grant be paid to the estate.
- The administrators
of the Estate have now advised Pension Services that her son has instructed
them to challenge the payment of the death grant to his sister.
- Pension Services
have sought and received confirmation from the administrators of the
Estate of all claimants they feel may satisfy the criteria in paragraph
1. This states that both her son and daughter are eligible. Her son
is aged over 18 and in full time employment and is, therefore, ineligible
for payment of a child’s pension.
RECOMMENDATIONS
- The Committee
is RECOMMENDED to:
- decide
how the contested payment should be administered / paid;
- endorse
current procedures.
SUE
SCANE
Head of Finance
& Procurement
Background
papers: Nil
Contact
Officers: Sally Fox Tel: (01865) 816080
August
2005
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