The Ministry of Defence has agreed to introduce the Short-Term Family Pension to the Armed Forces Pension Scheme 2015. The provision, which is in place for members of the 1975 scheme, was not carried over to the new 2015 scheme.
The Short-Term Family Pension is a payment made to widows, widowers or civil partners of service personnel following the death of a scheme member. Under the arrangement, dependants continue to receive pensionable pay for six months if they have children, or three months if they do not. The entitlement can range in value between £2,000 and £3,000.
People in the armed forces don’t understand the complexity of their pension scheme. The whole thing is totally appalling
Alastair Rush, Echelon Wealthcare
MoD criticised over comms
The 2015 scheme was established in April 2015, following the publication of the Hutton Report on public service pension provision.
With the exception of those who were within 10 years of their respective schemes’ normal pension age on April 1 2012, all service personnel who were members of an Armed Forces Pension Scheme, and who were due to serve beyond April 2015, were automatically transferred to the 2015 scheme.
Anthony Henderson, deputy pensions secretary at the Forces Pension Society, said when the transferral of members from the 1975 to the 2015 scheme took place, the armed forces were promised “the ‘75 entitlements would continue to... be calculated in exactly the same way”.
It was, however, discovered via the MoD’s “Defence Instructions and Notices”, that the Short-Term Family Pension was not included in the 2015 scheme. “It wasn’t particularly well-publicised,” Henderson said.
The MoD had given assurances over the consistent calculation of accrued benefits across the 1975 and 2015 schemes, but argued that the entitlement “wasn’t an intrinsic part of the ‘75 award, it was a standalone bolt-on, and therefore wasn’t protected”, according to Henderson.
The entitlement has now been reintroduced, and has been back-dated to April 2015.
An MoD spokesperson said: “We are firmly committed to supporting the armed forces community, including through retirement. After reviewing the Short-Term Pension provision, we decided to re-instate it for those that are eligible. This will benefit thousands of service families by supporting them at a time of bereavement.”
The MoD said it consulted widely on the introduction of the 2015 scheme and the benefits available, including with the Forces Pension Society. The society disputes this; its website states that “there was, to our knowledge no consultation” on the removal of the Short-Term Family Pension.
Alastair Rush, managing director at financial advisory firm Echelon Wealthcare and former member of the 1975 scheme, was not surprised about the complaints. He said: “People in the armed forces don’t understand the complexity of their pension scheme. The whole thing is totally appalling.”
Winning the battle, but not the war
The U-turn on the Short-Term Family Pension is welcome news for forces personnel and their families, but other concerns remain. According to the War Widows’ Association, there are widows and widowers who have lost their War Widow’s Pension after remarrying.
Under the terms of the War Pension Scheme 1975, dependants are entitled to a War Widow’s Pension where active service causes or hastens the death of a serviceman or woman.
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Mary Moreland, chairman of the War Widows’ Association, said that from 2005, any recipient eligible between 1973 and 2005 “had to surrender their War Widow’s Pension” if they remarried.
In November 2014, the government reversed this position, and allowed war widows and widowers to retain their War Widow’s Pension for life. But those who had already surrendered this pension and remarried “did not fall into that announcement”, according to Moreland.
An MoD spokesperson said: “Service families make an immense contribution to this country and the decision to allow war widows to keep their pension for life regardless of remarriage reflects our commitment to supporting the bereaved. We will continue to consider the potential options within our financial and legal boundaries.”
