Bradley & Ors, R (on the application of) v Secretary of State for Work & Pensions & Ors

A minister is not bound by a finding of maladministration made by the Parliamentary Ombudsman under the Parliamentary Commissioner Act 1967. The minister may reject it without first obtaining judicial review of the report.

The decision to reject must nevertheless be rational. The minister must give cogent reasons which respect the Ombudsman’s statutory function, investigation and findings. A mere preference for the department’s own view is insufficient.

Judicial review focuses on the rationality of the minister’s rejection, assessed in its statutory and evidential context. A rejection was irrational where the department did not answer the Ombudsman’s central finding that official pension assurances were incompatible with the Government’s intended level of protection.

The Parliamentary Ombudsman found that official information concerning the security provided by the minimum funding requirement for final salary occupational pension schemes was inaccurate, incomplete and potentially misleading. She also found resulting injustice and maladministration in the process by which a change to the funding basis was approved. The Secretary of State rejected those findings and most of her recommendations.

Members of affected schemes obtained judicial review. Bean J, in [2007] EWHC 242 (Admin), quashed the rejection of the first maladministration finding and the first recommendation. He upheld the rejection of the causation finding and the third maladministration finding.

The Secretary of State appealed against the decision concerning the first finding. The claimants cross-appealed concerning causation, the third finding and article 1 of the First Protocol, although the Convention ground was not pursued. The central issue was whether the Ombudsman’s findings bound the Secretary of State and, if not, whether the particular rejections were rational.

1. Secretary of State’s appeal dismissed. A finding by the Parliamentary Ombudsman under the Parliamentary Commissioner Act 1967 does not bind the minister unless quashed. The Act created an independent investigator serving Parliament. Its scheme leaves a minister free to reject a finding and defend that position before Parliament, where ministerial and governmental accountability operates. The different statutory scheme governing local government ombudsmen did not justify extending [1988] 1 QB 855 to the Parliamentary Ombudsman.

2. The freedom to reject a finding is controlled by ordinary public law. The minister must give reasons for rejecting a conclusion reached through the Ombudsman’s statutory investigation. It is insufficient that the department’s preferred view is itself rational. The relevant question is whether rejection of the Ombudsman’s finding is rational and supported by cogent reasons, taking account of her statutory role and investigation. The court’s focus is therefore on the minister’s decision to reject, rather than on whether the Ombudsman’s finding can itself be impugned.

3. The rejection of the first maladministration finding was irrational. The leaflet PEC 3 suggested that the minimum funding requirement would ensure that pensions were protected and that younger members would receive the cash value of their pension rights. The intended protection for non-pensioner members was only an even chance of equivalent benefits. The Secretary of State did not answer the Ombudsman’s central conclusion that the assurances were incompatible with that intention. The rejection was therefore quashed.

4. Claimants’ appeal allowed in part. The Secretary of State could rationally reject the finding that maladministration contributed to every individual’s financial loss, irrespective of reliance, the scheme’s funding position or available remedial action. He and the judge had not, however, answered the distinct findings that maladministration caused outrage, distress, anxiety and uncertainty, lost opportunities to make informed choices, and a distorted understanding of the risks. The appeal was allowed as to paragraph 5.245 and the second limb of paragraph 5.246 of the Ombudsman’s report, but dismissed as to the first limb of paragraph 5.246.

5. The Secretary of State rationally rejected the third finding. The department had received a considered recommendation from the actuarial profession, unqualified endorsement from the Government Actuary’s Department, and had considered relevant policy and implementation questions. The fact that further evidence might have been obtained did not require a finding of maladministration against the department. The Convention appeal, which was not pursued, was dismissed.

1. Court of Appeal (Civil Division): In [2008] EWCA Civ 36, the court unanimously dismissed the Secretary of State’s appeal. It allowed the claimants’ appeal in part concerning distinct forms of causally connected injustice, while dismissing the remainder.
2. Administrative Court: Bean J, in [2007] EWHC 242 (Admin), quashed the Secretary of State’s rejection of the first finding of maladministration and the first recommendation. He upheld the rejection of the causation finding and the third finding of maladministration, and dismissed the claim under article 1 of the First Protocol.