Trustees under no duty to make moral judgments as to suitability of a person to receive discretionary benefits

6th June 2024

Reviewing a recent Pensions Ombudsman decision, Trustees are under no duty to make moral judgments as to suitability of a person to receive discretionary benefits.

The Pensions Ombudsman decision of 7 March 2024 (CAS-67089-N7X6)

Mr TN (on behalf of his grandson Master N) made a claim against Ford Pension Fund Trustees (the “Fund” and the “Trustee”).

Mr TN complained that the Trustee did not properly consider all the information available when deciding how to distribute death benefits from the Fund on the death of his son Mr AN. In particular, Mr TN argued that the deceased’s new (unmarried) partner Ms O should not have received the spouse pension (he suggested her claim was fraudulent) and rather those monies should have augmented Master N’s benefit or been paid to the ex-wife.

Mr TN requested details of the Trustee’s decision-making which he said lacked balanced judgment and ignored the wishes of Mr AN.

The Deputy Ombudsman did not uphold Mr TN’s complaint and determined that the Trustee had acted properly in making the death grant and child pension to Master N and paying a spouse pension to Ms O. To show the decision was improper, Mr TN would have needed to provide evidence that the decision was made in consideration of irrelevant, irrational, or improper factors. From the information provided, the Deputy Ombudsman determined this was not the case and also there was no maladministration.

In response to the allegation that Ms O being paid the spouse pension somehow reduced Master N’s benefit, the Deputy Ombudsman held that Mr AN did not provide Ms O with monies for Master N’s living expenses and so there was no expectation that the widow’s pension should be used to support Master N.

The Deputy Ombudsman said:

I note that Mr AN has put forward a number of moral arguments as to why Ms O should not have been awarded a Widow’s pension. It is not the duty of the Trustees to make a moral judgment regarding suitability of a person to receive benefits from the Fund but rather to decide if they fulfil the relevant criteria in the Fund Rules.

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