There are two tiers of ill-health pension: lower tier and higher tier. There are certain service and medical conditions that have to be met for an ill-health pension to be granted.
These are:
- A minimum of 3 months’ qualifying service is required for a lower tier ill-health pension. The person must be incapable of performing any of the duties specific to their current job role. This can be due to incapacity of mind or body
- A minimum of 5 years’ qualifying service is required for a higher tier ill-health pension. The person must be entitled to a lower tier ill-health pension and must also be incapable of undertaking any regular employment because of incapacity of mind or body.
Regular employment involves working at least 30 hours a week, over a minimum period of 12 consecutive months.
A firefighter who has not reached normal pension age and who leaves because of permanent disablement, may be considered for an ill-health pension. If an ill-health pension is awarded, their active member’s account and any added pension account would be closed and a retirement account set up.
Determination of the Award
In regard to ill-heath pensions, it is the authority that will determine whether a pension can be paid. However, to do so they must first obtain and consider the written opinion of an Independent Qualified Medical Practitioner (IQMP).
The authority must give written notice of a decision to the member in question, together with a copy of the supplied medical opinion, within 14 days. If dissatisfied with a medical opinion, a member has the right to seek a reconsideration of that opinion and, if still dissatisfied, has a right to appeal to a Board of Medical Referees.
Calculation of a lower tier ill-health pension
The annual rate of a lower tier ill-health pension is calculated in the same way as a regular retirement pension. This means that it is the sum of the amount of retirement earned pension plus any retirement added pension.
If you choose to commute a portion for a lump sum or allocate a portion for a dependant, the appropriate reduction would be made, but there would be no reduction for early retirement.
Calculation of a higher tier ill-health pension
The annual rate of a higher tier ill-health pension is calculated as 2% of the retirement earned pension (before any reduction for commutation) multiplied by the member’s assumed period of pensionable service. This period begins the day after you retire and ends the day before you reach normal pension age.
For more information on the lower tier and higher tier ill-health pension or to find out more on your own personal ill-health pension, please get in touch with Peninsula Pensions.
Review
If a person has been receiving the ill-health pension for less than 10 years and is under deferred pension age (State pension age or 65 if higher), the authority must review the person’s entitlement in order for it to continue.
The authority will seek an IQMP to help conduct the review and produce a documented professional opinion. With this information, the authority will then determine whether the member should continue to receive the ill-health pension.
If it is determined that a person receiving a higher tier ill-health pension has become capable of undertaking regular employment, their entitlement to that pension will cease with immediate effect. However, a lower tier ill-health pension would continue.
Continuing entitlement to a lower tier ill-health pension is based on whether or not the recipient is considered capable of performing the duties of the role from which they originally retired. If they are not, then the pension payments will continue.
If it is considered that a person is capable to return to their original employment, then the authority must decide whether to offer the person re-employment in the same role from which they retired:
- Should no offer be made, the lower tier ill-health pension will continue in payment.
- Should an offer be made, payment of the lower tier ill-health pension will cease, even if the person does not take up the offer of re-employment.
If the person declines the offer of re-employment, the authority will create a deferred member’s account and credit it with an amount equal to the annual lower-tier ill-health pension previously received. The deferred pension will then continue to be paid at deferred pension age (State pension age or 65 if higher).