Money Help Desk: Are teachers being discriminated against with forfeited pension payments?

AS A teacher in the independent sector I had to retire at 60. This was the requirement at that time in 2001.

I decided to keep on teaching, initially part-time and for the past three years full time. I have paid into the Teachers Superannuation Scheme for these three years.

As my annual salary has been greater than my final year's salary before retirement, I could not take my teacher's pension even though I had paid into the scheme for many years. This means that for the past three years I have had my teacher's salary for the post which I am in, but no teacher's pension. If I had taken a job in anything other than teaching I would have been able to claim my teacher's pension even if I was earning £40K-£50K or whatever. This does not seem fair at all.

Does this rule apply in other professions or jobs such as law, medicine, police etc? When I retire completely do I get the amount I have forfeited for the past three years paid to me as an increase in my monthly teacher pension?

If the answers to the last two questions are no then there is some discrimination to teachers.

JF



Malcolm McLean, chief executive of the Pensions Advisory Service, writes:

MOST pension schemes within the public sector, including teachers', have what is known as an "abatement" rule under which on re-employment a scheme pension in payment can be reduced or stopped altogether.

The application of the rules may vary slightly from scheme to scheme but given their widespread use (covering civil servants, NHS workers et al) I very much doubt that teachers can claim to being discriminated against on this count.

In this reader's case, however, it might be worth checking whether the rules of the Teachers Pension Scheme have been correctly applied. It would usually be possible following normal retirement to return to work and retain entitlement to your pension.

This would not, however, be so if your pension had been awarded on some special terms: for example, at an earlier than normal age or on ill-health grounds where abatement would apply.

The reader is right, of course, that had he taken up a job elsewhere, say in the private sector, then his pension would not have been affected. It is also, I am afraid, the case that assuming the abatement is appropriate it will not be possible for him to receive a refund of any abated pension when he does eventually retire completely.


Must I sleep at building site to ensure cover?

WE HAVE been having some major restructuring work done to make a huge open plan kitchen/dining/living room like in the makeover programmes. We've had to move a number of structural walls, which has involved a lot of engineering work, and because of that, plus the fact that we would be without gas and electricity during the process, we moved out to stay with relatives.

As usual the work has dragged on, and now I realise that we have been out of the house for 30 days, after which our household insurance becomes null and void.

Do you have to actually be sleeping in the house to count as living in it? The builders have been there every day, and I have been on site most days.

But should I take my sleeping bag and camp out in the property for a night or two to keep the insurers happy and set the 30-day clock ticking again?

SH, Edinburgh


Ian Crowder, insurance expert at the AA, writes:

This sounds to be an exciting project that will enhance your home. But I sincerely hope that you informed your insurer that you were having the works carried out. If you didn't, you probably wouldn't be covered in the event of losses or damage while the contractors were there. It will also be important to have checked that your contractors have "all risks" cover in place should, for instance, they accidentally set the property on fire with a blowlamp, or cause structural damage while altering the walls.

Provided your insurer was informed, there should be no reason for you to camp out in your unfinished property. As you point out, insurers usually have a time limit on periods of non-occupancy beyond which the level of cover is significantly reduced but this is intended for times when you are away on holiday, for example.

Insurers recognise that while rebuilding works are continuing you might not be able to stay in your home, so the insurance requirements will be different. They may impose restrictions, conditions or exclusions and/or they may charge additional premium for the period of work. They will probably require evidence of your contractor's insurance cover. They may also insist that you regularly inspect your home, but you appear to be doing that anyway.

I suggest you speak to your insurer without delay.