Secretary of State for Justice v David White

Regulation 30(3)(b) of the Justices of the Peace Act 1949 (Compensation) Regulations 1978 requires a retirement-compensation lump sum to be reduced by the amount of the lump-sum superannuation benefit actually received under the last relevant pension scheme. It does not authorise deduction of a notional figure uprated for inflation. The provision must be read in the context of the Regulations’ purpose: compensating the shortfall in pension rights caused by loss of office while avoiding double recovery. The relevant service is the service used to calculate the pension-scheme benefit, not additional service credited solely for calculating Crombie compensation.

The Secretary of State appealed against an Employment Tribunal decision dated 11 February 2025 concerning the Respondent’s retirement compensation under the Justices of the Peace Act 1949 (Compensation) Regulations 1978. The Respondent’s retirement-compensation lump sum was agreed at £226,769.93. The dispute concerned the deduction required by regulation 30(3)(b) for the lump-sum benefit paid under the Local Government Pension Scheme when he lost office at age 50.

The Employment Tribunal held that the deduction was the actual sum received, £88,815.20. The Secretary of State contended that an inflation-uprated figure of £148,284.72 should be deducted. The central issue was the proper meaning and application of regulation 30(3)(b).

1. Appeal dismissed. The Respondent was entitled to an RC lump sum of £226,769.93, less £88,815.20, producing £137,954.73.
2. Regulation 30(3)(b) provides that a lump sum is reduced by the amount of any lump-sum superannuation benefit. Read naturally and in the legislative context, that means the benefit actually received. The wording contains no clear basis for substituting a notional, inflation-uprated amount.
3. The interpretation accords with the purpose of the Regulations. Retirement Compensation is intended to compensate for the shortfall between the pension benefits actually received after early loss of office and those that would have been received at normal retiring age. Deducting an amount from which the recipient never benefited would produce under-compensation and would not merely prevent double counting.
4. The same approach applies to regulation 30(3)(a): monthly compensation is reduced by the monthly pension instalments actually received. The pension-increase legislation also explained why the benefit paid at age 50 was not subsequently uprated.
5. The words in regulation 30(3) concerning service of which account was taken refer to the service used to calculate the superannuation benefit under the last relevant pension scheme. Here that was the Respondent’s 28.34 years of LGPS membership. It did not include the additional 15 years credited under regulation 17(2) for the separate calculation of RC.
6. The Compromise Agreement and comparable governmental guidance supported the same construction, referring to the retirement lump sum already paid. The Secretary of State’s reliance on the service wording was a new and flawed point, though it was permitted to be argued as a pure point of law.

• High Court (Administrative Court): The appeal against the Employment Tribunal’s decision dated 11 February 2025 was dismissed.