Secretary of State for Health v Marshall

An administrator of an occupational pension scheme may be responsible for maladministration where delegated administrative arrangements fail to bring valuable, time-sensitive pension rights to a member’s attention. Delegation to an employing authority does not necessarily transfer that responsibility.

Successive wrongful omissions may each remain causative of a loss where either omission, if remedied, would have prevented it. The statutory opportunity to comment under the Pension Schemes Act 1993 is engaged by allegations made in the complaint or reference, not by an administrator’s later suggested enquiry. An appeal on a point of law failed, although the practical remedy could not be enforced because the respondent had obtained substantially the same benefit elsewhere.

The Secretary of State appealed under section 151(4) of the Pension Schemes Act 1993 against a determination by the Deputy Pensions Ombudsman on Mrs Marshall’s complaint of maladministration. She alleged that NHS Pensions had failed to inform her in time of a right to repurchase refunded pensionable service from earlier Scottish NHS employment.

The Ombudsman found maladministration and directed NHS Pensions to facilitate repurchase. By the time of the determination, Mrs Marshall had substantially obtained the same remedy through the Scottish Public Pensions Agency. The appeal challenged the findings of maladministration and injustice, and alleged procedural unfairness because the Scottish agency had not been invited to comment.

1. Appeal dismissed. All grounds advanced by the Secretary of State failed. The finding of maladministration therefore stood.
2. The statutory disclosure requirements under Regulation 5 of the Occupational Pensions Scheme (Disclosure of Information) Regulations 1986 did not themselves require information about voluntary increases in benefits, including repurchase rights. That did not exhaust NHS Pensions’ responsibility to take reasonable steps to bring valuable and conditional pension rights to members’ attention.
3. Applying Scally v Southern Health and Services Board [1992] 1 AC 294, an obligation of that kind may arise in the employment relationship. Although the Secretary of State was not Mrs Marshall’s employer, statute placed management of the relevant pension rights on NHS Pensions. Its delegation of practical dissemination to health authorities did not remove its vicarious administrative responsibility.
4. The Ombudsman was entitled to infer that the failure by the employing authorities to send the explanatory booklet, despite clear instructions, resulted from lack of care and amounted to maladministration for which NHS Pensions was responsible. Maladministration could exist without breach of statutory duty or negligence.
5. The later failure by the Scottish agency to inform Mrs Marshall did not break the chain of causation. Both omissions contributed to her ignorance, and either authority’s adequate information would have enabled her to exercise the right. The issue was fact-sensitive, and no proper factual or legal basis had been established for the proposed appeal ground.
6. Section 149(1)(b) did not apply. The complaint alleged maladministration by NHS Pensions only; it made no allegation against the Scottish agency. Nor did that provision confer on NHS Pensions a right to complain of a procedural failure intended to protect the person entitled to comment. Any necessary enquiry was for NHS Pensions to make.
7. Although Mrs Marshall no longer appeared to have continuing significant injustice, because she had obtained the remedy elsewhere, the Ombudsman’s directions were in any event unenforceable in practical terms. The Secretary of State did not need to appeal to obtain that benefit.

The judgment states that the Secretary of State appealed under section 151(4) of the Pension Schemes Act 1993 from the Deputy Pensions Ombudsman’s determination dated 11 September 2007. No other appellate stage is stated.