The first defendant was a long serving chief fire officer and a member of the firemen’s pension scheme. The scheme provided that the normal pension age was 55, but a member could take an ordinary pension at the age of 50 in certain cases of long service. Entitlement to a pension at the age of 50 did not apply to a chief fire officer unless his/her notice of retirement was given with the permission of the claimant fire authority. The Finance Act 2004 raised the minimum age from 50 to 55 at which most pension savers could access their pensions without incurring an unauthorised payments tax charge. Paragraph 22(4)(a) of Schedule 36 protected an “actual or prospective right” to any benefit from an age of less than 55 which a member had had under a pension scheme before 5 April 2006, when the new minimum retirement age took effect. The defendant sought retirement pension payments before he attained the age of 55, which the claimant was willing to make providing they did not amount to unauthorised payments.
On the claimant’s claim for a declaration as whether the defendant satisfied the entitlement condition in paragraph 22(4)(a)—
Held, that to be an “actual right” to a benefit within the meaning of paragraph 22(4)(a) of Schedule 36 to the 2004 Act, the right had to be an immediate right to the benefit and subject to no contingencies. Where there was no immediate right to a benefit but a contingent future right subject to future contingencies, the right would be a “prospective right” if the future contingences, such as the occurrence of natural events (attaining a certain age) were wholly within the control of the member (such as not taking certain specified types of employment on retirement). However, “prospective right” excluded any entitlement that would only arise if and when a third party exercised a discretion or gave some consent or permission to the retirement notice. As at 5 April 2006 the first defendant’s right to an early pension was dependent on his receiving the claimant’s permission in the future. He therefore did not satisfy the entitlement condition contained in paragraph 22(4)(a) and any payments made to him under the scheme prior to him reaching the age of 55 would amount to unauthorised payments (paras 95, 103, 105, 115, 121, 125, 126).
Harriet Brown (instructed by Plymouth City Council Legal Services) for the claimant.
The first defendant did not appear and was not represented.
Simon Oakes (instructed by Solicitor to Revenue and Customs) for the Revenue.