Magazine article Public Finance

Government Will Not Recover £126M Pensions Overpayments

Magazine article Public Finance

Government Will Not Recover £126M Pensions Overpayments

Article excerpt

The government will write off the £126m cost of pensions overpayments made to former public sector workers, ministers said this week.

Errors had been made in payments over 3O years to around 5% of pensioners in schemes for civil servants and other public sector workers, Cabinet Secretary Liam Byrne said in a parliamentary statement on December 16.

The problems began in 1978 when the schemes contracted out of the State Earnings Related Pensions Scheme, as a result of incorrect indexation of the Guaranteed Minimum Pension element, Byrne said.

Around 95,0OO members of the five schemes, along with up to 1,8OO former police officers, are affected across England and Wales, plus 8,200 pensioners in Scotland and Northern Ireland.

The pensioners face cuts in payments or a reduction in their expected inflationary increase from Aprit. But Byrne said it was 'unlikely to be cost-effective to attempt recovery' of the overpayments already made. …

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