Firefighting pensions on divorce

Ian Conlon

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About four years ago I was instructed to act in a divorce case for the spouse of a serving senior police officer. The CETV as quoted was approximately £750k and the first task was to satisfy myself that the accrued pension benefits and CETV had been calculated correctly. As the officer had already completed 25 years service the CETV should have reflected the value of benefits payable from age 50. I recall the shock at discovering that the CETV had incorrectly been calculated on the basis that benefits would come into payment at age 60 and that the correct CETV was around £1.25m.

Ok, so that was some time ago, I had assumed that such major issues would have been sorted out by now. So I was really quite taken aback when searching on the internet for some specific details in relation to the Firefighters’ Scheme when I came across a Firefighters’ Pension Scheme Circular from June 2010 which highlighted this exact issue. According to the circular, the pension administration system which they use had been applying the incorrect factors for calculating CETVs for divorce in situations where the member had attained age 50 and had completed 25 years service.

It may well be the case that the scheme administrators were aware of this issue for some time and were manually calculating these CETV requests, however the Circular does start with the words “It has come to our attention” which certainly raises the possibility that past CETVs have been calculated incorrectly and have possibly also led to the incorrect calculation of Pension Credits and/or Pension Debits resulting from a Pension Sharing Order.

Given that the issue relates to those aged over 50, the pension benefits in such scenario will be fairly material so a pensions expert should have been involved who would have picked up on any incorrect CETV of this magnitude. The position could be difficult if a materially incorrect CETV has not been spotted! It does certainly highlight the need for professional support where defined benefit pension benefits are involved.