Following the Union’s campaign, the Trustee of the Lloyds Bank Offshore Pension Scheme and the Bank have said that they will be treating men and women in exactly the same way when dealing with the State Pension Deduction.
Members will recall that in a previous Newsletter we told the story of one recently retired member on the Isle of Man who was struggling to cope with the fact that her bank pension was being reduced every month to pay for a state benefit she wasn’t getting. We said: “….the Trustee and Bank are dragging their feet and fobbing her off with promises of jam tomorrow. Every month this member dips into her own savings to cover her living expenses because she’s paying a deduction for a benefit she’s not getting yet. There are other members in exactly the same position.”.
Furthermore, we said that if the issue wasn’t resolved the Union’s lawyers would write to the Lloyds Bank Offshore Pension Scheme Trustee Board insisting that all staff, regardless of gender, are treated exactly the same when it comes to the State Pension Deduction, including those female members of staff who have already retired and are paying the deduction now.
The Bank has listened and female members will not have their pensions deducted anymore.
The member has written to the Union saying: “Excellent news, I’ve had a letter from Pensions – it’s now all sorted (for everyone, not just me!). From this month l’ll receive my full pension again, & it includes a rise so I’m going to be feeling so rich, something like an extra £170 gross every month. There’ll be a refund of what’s already been deducted in January, with interest at BoE base rate + 1% – my poor, beleaguered savings account won’t know what’s hit it. : ) It feels such a massive relief”.
The Background
To recap, like most employers the Bank took the opportunity in the 1970s to contract out of the state earnings related pension scheme and pay less national insurance. Members also paid reduced national insurance contributions. One of the results of this ‘contracting out’ is that staff who joined one of the Bank’s Pension Schemes between 30th June 1977 and 31st March 1997 will on receipt of their state pension have a reduction in their bank pension.
Generally speaking, similar arrangements to those operating in the UK apply to members of staff based in Offshore Banking (Jersey, Guernsey and Isle of Man). For UK members of one of the Lloyds Bank Pension Schemes, the State Pension Deduction or Clawback is made when the member receives their state pension. Under the Lloyds Bank Offshore Pension Scheme, the State Pension Deduction, which is calculated using the UK Basic State Pension, is made at age 60 for females and 65 for males. The State Pension Age in Jersey is currently 65 but is gradually rising to 67 over a 12-year period starting from 2012.
The Issue
Before we got involved, it was the case that the Lloyds Bank Offshore Pension Scheme treated men and women who joined the Bank in Jersey, Guernsey and the Isle of Man at the same time and retired at 60 differently. The man would get his full pension with no state deduction until he reaches 65, whereas a woman’s pension would be reduced immediately. Women were having the State Pension Deduction taken from their pensions but they are not getting the State Pension. Following our intervention, that unequal treatment has been resolved.
Members with any questions on this Newsletter can contact the Union’s Bedford Office on 01234 262868 (Choose Option1).