2,200 Face Cuts To Pension After Overpayments

Well over 2,000 people in Northern Ireland are to receive letters from their pension scheme administrators seeking recovery of accumulated overpayments.

The move follows a written Joint Ministerial Statement laid in the Westminster Parliament today detailing an overpayment of some public sector pensions.

However, while the UK Chancellor Alistair Darling (pictured) said money that has been overpaid to civilian and military pensioners across the UK need not be repaid, the net result of the national financial blunder - first uncovered in Northern Ireland - is that thousands still face having their pensions 'cut' from April next year to make up at least some of the overpayments.

The issue was initially raised in the House of Commons by the Liberal Democrat Treasury spokesman, Vince Cable. He was first informed about the problem 10 days ago by a BBC Radio Ulster journalist.

It transpires that huge numbers of ex-military personnel and NHS staff are caught up in the chaos, which is thought to date back years and while the Government has already made clear it will not seek to "claw back" the cash immediately, Alistair Darling said the individuals would be forced to accept lower payments in future - sparking fears that many could be left struggling to make ends meet.

The problem could be made worse because recent heavy falls on the stock market and sharp reductions in interest rates have cut pensioners' income from savings.

Dr Cable said that a firm called Xafinity Paymaster had overpaid public sector pensions to former servicemen and health service staff "for decades".

Dr Cable revealed that he raised the matter with Cabinet Secretary Sir Gus O'Donnell "several days ago", who confirmed the difficulty and asked for time to contact pensioners and tell them what had happened.

Dr Cable asked the Chancellor: "What are the steps that are going to be taken to retrieve the overpayments - which I understand in some cases is going back decades and are potentially enormous?"

Mr Darling responded yesterday that repayments were "not going to happen".

But he added: "It will be necessary to adjust what's paid for the future. It does need to be put right from next year."

A Government spokesperson said today: "This UK-wide error affects approximately 2,200 pensioners in Northern Ireland mainly in civil service, teachers, health, and local government pension schemes.

"Collectively, this represents around 2.35% of the total number of pensioners in those schemes. All scheme administrators will be writing to all affected pensioners."

The causes of the overpayments have been rigorously investigated said the spokesperson, who continued: "Helplines to respond to affected pensioners' questions and concerns have been set up and advice and guidance has been placed on scheme websites.

"These pension overpayments are regrettable; however it is good news that no pensioner will have to pay back monies received in error."

(BMcC)