The Queen (on the application of British Medical Association) v Secretary of State for Health and Social Care

Hearing date: 21 November 2019

Judgment Approved

INTRODUCTION

This claim challenges the lawfulness of certain provisions of the National Health Service Pension Schemes, Additional Voluntary Contributions and Injury Benefits (Amendment) Regulations 2019 (“the 2019 Regulations”) by which amendments were made to the terms of the NHS Pension Scheme.

Prior to the relevant amendments, the Defendant (“the Secretary of State”) had the power to forfeit a pension after a member or beneficiary of the pension scheme had been convicted of a prescribed criminal offence which was committed before the benefit became payable. Most, if not all, public sector pension schemes contain similar provisions. The amendments confer upon the Secretary of State an additional power to suspend payment of pension benefits not only after conviction and prior to a decision being taken on forfeiture, but also where a person is charged with certain very serious offences (“the suspension power”).

There is nothing in the 2019 Regulations or the amendments to the underlying pensions regulations effected by them that entitles a person affected by a suspension order to appeal. Suspension does not terminate automatically upon acquittal or in other circumstances in which forfeiture could no longer take place, and there is no limit in terms of time or amount, save that in most cases the guaranteed minimum pension cannot be forfeited (and thus, by necessary implication, payment of that element cannot be suspended).

The 2019 Regulations were made by the Secretary of State on 28 February, laid before Parliament on 4 March, and came into force on 1 April 2019. As at the date of the hearing of the claim for judicial review, the suspension power had not been exercised.

The claimant, the British Medical Association (“the BMA”), represented by Ms Morris QC and Ms Thelen, is a trade union and professional body for doctors in the UK, with a membership of more than 150,000. Most of its members belong to the NHS Pension Scheme. The BMA has serious concerns about the potential impact on its members of the introduction of the suspension power. It is particularly concerned that the changes will disproportionately impact on those who are already receiving their pensions, who are more likely to be suffering from ill health or a disability than those who have not yet retired from practice, either by reason of their age or because those factors led the individual concerned to take early retirement.

The judge who considered the application for permission on the papers directed a “rolled-up” hearing of the adjourned application for permission, with the substantive claim to follow if permission were granted. At the start of the hearing, I indicated to counsel that I considered that the threshold for granting permission had been met, and accordingly the hearing was to be treated as the hearing of the substantive claim.

For the reasons set out in this judgment, the BMA has established that the power to suspend pension benefits prior to conviction in the form in which it was introduced by the 2019 Regulations is a breach of Article 14 read together with Article 1 Protocol 1 (“A1P1”) of the European Convention on Human Rights (“ECHR”). This is compounded by an absence of appropriate procedural safeguards as required by Article 6(1) ECHR and/or the common law principles of natural justice. Although the Article 6 deficiencies might have been capable of cure had they stood alone, regrettably, I am unable to use the wide powers given to the Court under s.3(1) of the Human Rights Act 1998 to interpret the legislation in a manner which would render it compatible with the ECHR. The Secretary of State also failed to comply with the Public Sector Equality Duty (“PSED”) under s.149 of the Equality Act when making the 2019 Regulations, which is an entirely independent ground upon which the decision to introduce this power was unlawful.

The claim for judicial review is therefore allowed and the BMA is entitled to the relief that it seeks.

THE NHS PENSION SCHEME

The NHS Pension Scheme is a contributory pension scheme. It is defined by three sets of regulations under which entitlement to pension and other benefits is calculated.

In common with other public sector pension schemes, the NHS Pension Scheme has undergone major reform in recent years. Since 1 April 2015, those joining the NHS have been enrolled into the pension scheme defined by regulations made in 2015, (“the 2015 Regulations”) with employees who joined prior to that date transferring into the new scheme from one of the older pension schemes regulated by regulations made in 1995 and 2008. Although the three sets of regulations are not identically worded, it is common ground that there is no material difference between them for the purposes of this claim. Therefore, I need only refer to the relevant provisions of the 2015 Regulations.

THE FORFEITURE PROVISIONS

In the 2015 Regulations the forfeiture provisions are found in paragraph 12 of Schedule 3. The main provisions are sub-paragraphs (1) – (3):

(1) the Secretary of State may direct that all or part of any rights to benefits or other amounts payable to or in respect of a member under these Regulations be forfeited if –

(a) the member is convicted of any of the offences specified in sub-paragraph 2; and

(b) the offence was committed before the benefit or other amount becomes payable.

(2) the offences are –

(a) an offence in connection with employment that qualifies the member to belong to this scheme, in respect of which the Secretary of State has issued a forfeiture certificate;

(b) one or more offences under the Official Secrets Acts 1911 to 1989 for which the member has been sentenced on the same occasion to –

(i) a term of imprisonment of at least 10 years; or

(ii) two or more consecutive terms amounting in the aggregate to at least 10 years.

(3) in sub-paragraph 2(a) ‘forfeiture certificate’ means a certificate stating that the Secretary of State is satisfied that the offence –

(a) has been gravely injurious to the State; or

(b) is liable to lead to serious loss of confidence in the public service.

By sub-paragraph (4), the Secretary of State is given the power to direct that all or part of any rights to benefits or other amounts payable in respect of the member be forfeited where the benefits or amounts payable to a person falling under sub-paragraph (5) who has been convicted of the murder or manslaughter of that member, or of any other offence of which unlawful killing of that member is an element. Those persons include the deceased member's surviving spouse or civil partner, another dependant, or a beneficiary to whom the pension benefits or amounts are payable under the deceased member's will or on his or her intestacy. This reflects the long-established forfeiture rule on inheritance, by which someone who is criminally responsible for the death of another person is precluded from inheriting under that person's estate unless (in a case other than murder) the Court exercises its discretion under the Forfeiture Act 1982 to disapply the rule in the interests of justice.

Sub-paragraph (6) precludes the Secretary of State from forfeiting any part of a guaranteed minimum pension (except in circumstances where paragraphs 12(1) and 12(2)(b) or 12(4) are invoked).

Although there is nothing on the face of the 2015 Regulations requiring the Secretary of State to seek representations from the person liable to be affected before making a decision under paragraph 12(1) to direct the forfeiture of pension benefits, it is the practice of the Secretary of State to do so. This was confirmed in paragraph 6.4 of the Secretary of State's response to the public consultation carried out prior to the making of the 2019 Regulations.

THE SUSPENSION PROVISIONS

The suspension power introduced by the 2019 Regulations is found in the new paragraph 12(8) to (15) of Schedule 3 of the 2015 Regulations. A suspension decision is defined in sub-paragraph (10) as follows:

(10) A suspension decision is a decision of the Secretary of State suspending the right to, and the payment of, all or part of any benefit or other amounts payable –

(a) which the member is in receipt of, or becomes entitled to,

(b) in respect of a member,

under these Regulations.

The power to make a suspension decision derives from sub-paragraph 8:

(8) If, on or after 1 April 2019, a member is –

(a) charged with an offence; or

(b) convicted of an offence,

which, in the opinion of the Secretary of State, may lead to all or part of the member's benefits being forfeited under paragraph (1), the Secretary of State may make a suspension decision in accordance with paragraphs 10 to 15 of this regulation.

By sub-paragraph (11) a suspension decision will have effect until either the Secretary of State directs otherwise, or the Secretary of State decides not to direct forfeiture. Although designed as an interim measure, theoretically, the amendments make it possible for the benefits to be suspended indefinitely – obviating the necessity to make a forfeiture decision following conviction, or even to provide a forfeiture certificate in a case that would require one. There is no provision for periodic review and, as already noted, no right of...