AEA Technology Pension Case

Public Accounts Committee Closed Inquiry
Opened: 20 Jan 2023 Closed: 24 Sep 2023 Parliament page
Following its work on the British Steel Pension Scheme , the Committee will question Government Actuary Martin Clarke and Karl Banister, Director of Operations, Legal and Clinical, from the Parliamentary and Health Service Ombudsman on the Atomic Energy Agency Technology pension case. This inquiry is based on an ongoing NAO … Read more
3 Recommendations
17 Conclusions
2 Reports
1 Oral session
3 Letters
1 Event
Activity timeline 8 events
23 Nov
2023
Report published
24 Sep
2023
Report published
11 Jul
2023
Correspondence
14 Jun
2023
Report published
17 Apr
2023
Correspondence
17 Apr
2023
Correspondence
13 Mar
2023
Oral evidence
13 Mar
2023
Formal meeting (oral evidence session) · The Grimond Room, Portcullis House
Oral evidence sessions 1 session
13 Mar 2023
View on parliament.uk
AEA Technology pension case
Karl Banister · Parliamentary and Health Service Ombudsman Martin Clarke · Government Actuary’s Department (GAD) Tom Josephs · Department for Work and Pensions
Recommendations & Conclusions
20 results
2 Recommendation Rejected
Fifty-Seventh Report - AEA Technol…
Ensure independent review for AEAT pension scheme members' long-standing complaints.
AEAT pension scheme members have been passed from one part of government to another, with no department taking overall responsibility for their complaints. Scheme members have raised complaints with government since 2012 covering a range of issues that involve several … Read more
Government Response
The government disagrees with the recommendation, stating that complaints have already been considered by ombudsmen whose remits are statutory policy matters. It adds that the 2013 Fair Deal policy prevents similar situations from arising again.
HM Treasury
View details
3 Recommendation Deferred
Fifty-Seventh Report - AEA Technol…
Review ombudsman arrangements to ensure adequate appeal routes for pension complaints.
The AEAT case shows that there are gaps in the routes of appeal available for people raising complaints about their pensions. It is a fundamental right that 6 AEA Technology Pension Case people have appropriate and accessible routes of appeal. … Read more
Government Response
The government deflects the recommendation, stating that the request for the Public Administration and Constitutional Affairs Committee to consider time limits is a matter for that Committee. It does not address the recommendation to review ombudsman arrangements.
HM Treasury
View details
4 Recommendation Accepted
Fifty-Seventh Report - AEA Technol…
Write to set out support for informed pension financial decisions within three months.
This is another case of government not giving people enough time or support to make complex financial decisions. The government has a role to help people make good financial decisions, because of the detriment that bad choices can lead to. … Read more
Government Response
The government agrees to write to the Committee detailing actions to support informed financial decisions regarding pensions. It cites specific initiatives already in place, such as the Stronger Nudge to Pensions Guidance and the national rollout of the mid-life MOT, and recent regulations made on 19 July 2023 for Pensions Dashboards.
HM Treasury
View details
1 Conclusion Rejected
Fifty-Seventh Report - AEA Technol…
Evidence heard from DWP, GAD, and PHSO regarding AEAT privatised pensions.
On the basis of a report by the Comptroller and Auditor General, we took evidence from the Department for Work & Pensions (DWP), the Government Actuary’s Department (GAD) and the Parliamentary and Health Service Ombudsman (PHSO) on the pensions transferred … Read more
Government Response
The government disagrees, stating that Pension Protection Fund indexation rules are set out in legislation and changing them would require a change in law, which is a policy matter.
HM Treasury
View details
5 Conclusion
Fifty-Seventh Report - AEA Technol…
No less favourable" pension terms excluded government guarantee for AEAT scheme security.
When the Atomic Energy Authority Act 1995 was introduced to facilitate the privatisation of AEAT and outline the pension arrangements, it required that the pension benefits in the new AEAT scheme must be “no less favourable” than the previous scheme. … Read more
HM Treasury
View details
6 Conclusion
Fifty-Seventh Report - AEA Technol…
Government information failed to disclose loss of pension scheme government guarantee.
None of the information government provided to scheme members told them the government guarantee would be lost if they transferred their accrued benefits into the new pension scheme.7 We asked GAD why members were not told this, and whether the … Read more
HM Treasury
View details
7 Conclusion
Fifty-Seventh Report - AEA Technol…
GAD's note significantly influenced AEAT members' pension transfer decisions, despite caveats.
GAD’s note suggested that scheme members seek independent financial advice if they were unsure of the most suitable course of action.10 We asked GAD whether it was realistic for scheme members to get independent financial advice, particularly when GAD is … Read more
HM Treasury
View details
8 Conclusion Rejected
Fifty-Seventh Report - AEA Technol…
AEAT pension members lose significant real value due to inadequate inflation protection in PPF.
Since the scheme entered the PPF, members have lost money in real terms each year because the compensation they receive does not include rises for inflation. PPF compensation initially provides members 100% of their pension if they had already reached … Read more
Government Response
The government rejects the recommendation, stating that changing the Pension Protection Fund indexation rules would require legislative change and is therefore a policy matter on which they cannot respond further.
HM Treasury
View details
9 Conclusion Rejected
Fifty-Seventh Report - AEA Technol…
AEAT pension scheme members received unsatisfactory and inconsistent responses to their long-standing complaints.
From 2012 onwards, scheme members raised a series of complaints with multiple government organisations and were dissatisfied with the responses they received. In July 2013, DWP produced a factsheet summarising the complaints government had received and a response to each … Read more
Government Response
The government rejects the conclusion, stating that complaints were already considered by relevant government bodies. They indicate that changing an ombudsman's remit is a policy matter, and existing 2013 Fair Deal policy prevents similar circumstances from reoccurring.
HM Treasury
View details
10 Conclusion Rejected
Fifty-Seventh Report - AEA Technol…
Government departments showed unclear responsibility for AEAT pensions, creating further confusion for members.
When we asked it why no part of government had taken responsibility for the issue, DWP described pensions policy as a complex and wide-ranging area which touches on a number of departments. DWP is responsible for private sector pensions rather … Read more
Government Response
The government rejects the recommendation, stating that changing the ombudsman's remit is a policy matter and the 2013 Fair Deal policy prevents similar situations from reoccurring.
HM Treasury
View details
11 Conclusion Rejected
Fifty-Seventh Report - AEA Technol…
Government has not independently reviewed AEAT complaints, and ombudsman services lack jurisdiction for investigation.
Government has not commissioned any independent review into the complaints raised by AEAT members, and all of the relevant ombudsman services have said they cannot investigate the information government provided in 1996.19 PHSO told us it is unable to investigate … Read more
Government Response
The government rejects the recommendation, stating that changing the ombudsman's remit is a policy matter and the 2013 Fair Deal policy ensures similar circumstances will not reoccur in the future.
HM Treasury
View details
12 Conclusion Rejected
Fifty-Seventh Report - AEA Technol…
Government’s Fair Deal policy seeks to prevent future pension issues, yet ombudsman jurisdiction gaps persist.
We asked how government can ensure that, if a similar thing were to happen again, pensioners making complaints would not be shunted from pillar to post in trying to make appeals and getting no advice or satisfaction. DWP told us … Read more
Government Response
The government rejects the recommendation, stating that changing the ombudsman's remit is a policy matter and the 2013 Fair Deal policy ensures similar circumstances will not reoccur in the future.
HM Treasury
View details
13 Conclusion Deferred
Fifty-Seventh Report - AEA Technol…
Accessible ombudsman services are essential for people to pursue independent, affordable routes of appeal.
It is a fundamental right that people should have appropriate and accessible routes of appeal. Actions by government bodies are in principle subject to judicial review through the courts, but this is an expensive process.25 Ombudsman services provide a way … Read more
Government Response
The government agrees with the recommendation and will conduct an independent review of The Pensions Ombudsman in Autumn 2024, noting the department can request consideration of other relevant areas during this review.
HM Treasury
View details
14 Conclusion Deferred
Fifty-Seventh Report - AEA Technol…
Ombudsman services lack statutory jurisdiction to investigate key 1996 government information in AEAT case.
In the case of the AEAT pension scheme, relevant ombudsman services said they were unable to properly investigate key aspects of scheme members complaints.27 Some aspects of the case could be reviewed. For example, GAD described to us how complaints … Read more
Government Response
The government agrees with the recommendation and will conduct an independent review of The Pensions Ombudsman in Autumn 2024, noting the department can request consideration of other relevant areas during this review.
HM Treasury
View details
15 Conclusion Deferred
Fifty-Seventh Report - AEA Technol…
PHSO's legislative remit contains significant gaps preventing investigation of AEAT pension cases.
PHSO described to us the gaps in its remit which prevent it from providing pension scheme members with a route to appeal in this case or in similar situations. PHSO explained that its jurisdiction only allows it to investigate GAD … Read more
Government Response
The government agrees with the observation, stating that The Pensions Ombudsman will undergo an independent review in 2024, during which the department can request consideration of additional areas, without committing to amend PHSO's legislation.
HM Treasury
View details
16 Conclusion Deferred
Fifty-Seventh Report - AEA Technol…
Pensions Ombudsman faces remit limitations, Limitation Act barriers, and inadequate data retention protocols.
The Pensions Ombudsman may also be a suitable body to investigate the administration and management of pension schemes, as it is the expert in government for investigating pensions complaints.32 However, it has no remit over the role of GAD in … Read more
Government Response
The government agrees with the recommendation and will conduct an independent review of The Pensions Ombudsman in Autumn 2024, stating the department can request the reviewer considers other areas that would benefit from their consideration.
HM Treasury
View details
17 Conclusion Accepted
Fifty-Seventh Report - AEA Technol…
Government provided insufficient and misleading information with restrictive one-month deadline for AEAT pension decisions.
The AEAT case is one where government directly provided information intended to help pension scheme members decide what to do with their accrued pension benefits. Members were only given one month to make the decision, and consider that the information … Read more
Government Response
The government agrees with the recommendation and will inform the Committee of actions taken to support informed pension decisions. They cite recent steps like the Stronger Nudge to Pensions Guidance, national mid-life MOT delivery, and new regulations for Pensions Dashboards.
HM Treasury
View details
18 Conclusion Accepted
Fifty-Seventh Report - AEA Technol…
Government and regulators consistently fail to adequately support individuals making complex financial decisions.
This committee has previously found similar issues with how government provides or oversees support for people making complex or long-term financial decisions, including through the regulation of independent financial advice. Most recently, our inquiry last year into the British Steel … Read more
Government Response
The government agrees with the recommendation and will inform the Committee of actions taken to support informed pension decisions. They cite recent steps like the Stronger Nudge to Pensions Guidance, national mid-life MOT delivery, and new regulations for Pensions Dashboards.
HM Treasury
View details
19 Conclusion Accepted
Fifty-Seventh Report - AEA Technol…
Consumers and students lack adequate support to understand complex financial products and education choices.
This committee’s 2016 report on financial services mis-selling similarly concluded that the Financial Conduct Authority was not doing enough to ensure that consumers understand the financial products they are buying. The report found that even the most knowledgeable consumers can … Read more
Government Response
The government agrees with the recommendation and will inform the Committee of actions taken to support informed pension decisions. They cite recent steps like the Stronger Nudge to Pensions Guidance, national mid-life MOT delivery, and new regulations for Pensions Dashboards.
HM Treasury
View details
20 Conclusion Accepted
Fifty-Seventh Report - AEA Technol…
DWP initiatives for improving pension financial advice lack clear timelines for tangible improvements.
We asked DWP how government can ensure it gives clearer and more accessible financial advice in similar situations in future. DWP told us that changes to policy on privatisations and transfers of pensions meant that the specific circumstances affecting 33 … Read more
Government Response
The government agrees, committing to write to the Committee by September 2023 to outline actions for supporting informed pension decisions through advice, guidance, and reduced complexity, alongside ongoing initiatives like the Stronger Nudge and Pensions Dashboards.
HM Treasury
View details
Government Response AI assessment · 17 of 3 classified
Accepted 5
Deferred 5
Rejected 7
Total 3 recs + 17 conclusions
Correspondence 3 letters
11 Jul 2023 Correspondence from William Wragg MP, Public Administration and Constitutional Affairs Committee, re Public Accounts Committee – Report on the AEA Technology Pension Case, dated 4 July 2023
Parliament page
17 Apr 2023 Correspondence from Tom Josephs, Director, Private Pensions and Arm’s Length Bodies Department for Work and Pensions, re DWP follow up to the Public Accounts Committee Hearing on Atomic Energy Authority Technology pension scheme 13 March 2023, dated 4 April 2023
Parliament page
17 Apr 2023 Correspondence from Martin Clarke, Government Actuary, Government Actuary’s Department, re Public Accounts Committee Hearing 13th March 2023 – AEAT Pension Scheme, dated 27 March 2023
Parliament page