“Conflict Of Interest” – A term used to describe the situation in which a public official or fiduciary who, contrary to the obligation and absolute duty to act for the benefit of the public or a designated individual, exploits the relationship for personal benefit, typically pecuniary.
Up until 2006, the source of funding of police injury pensions were the payments which serving officers made, by way of deductions from their salaries, amounting some 11%. Those contributions were intended to be sufficient to covered the costs of the ordinary retirement pension and the injury benefits.
However, in 2006, the Government made the injury benefit scheme a freestanding scheme, ostensibly because this was a move necessary to preserve the tax free status of the injury benefits (gratuity and pension for life).
In 2006, the Police Pension Regulations were amended to remove injury benefits from that legislation and new Regulations – The Police (Injury Benefit) Regulations 2006 were made.
The change was necessary because a new tax regime for registered pension schemes – introduced by the Finance Act 2004 – came into effect on 6 April 2006. Any unauthorised payment would thus incur a tax charge. In order not to let the Police Pension Scheme incur such charges, it was necessary to separate the injury benefits from the pension scheme regulations.
However, the Government at the same time also decided that funding for the injury benefit scheme would now come entirely from the operating budget for each force.
We may speculate that the Government was aware, that prior to 2006, there had been some inventive use, shall we say, of the injury benefits. When it suited forces to do so, they could rid themselves of expensive long serving officers of constable and sergeant rank by retiring them on an injury pension. The force could then hire cheaper labour in the form of new recruits.
There is some suggestion that the Government may have encouraged this or at least gave tacit approval.
The immediate effect of the change in funding arrangements meant that some chief officers and police authorities began to view payment of existing injury pensions as a burden – a drain on resources. Those attitudes grew more entrenched whenever the Government required forces to make cuts in spending.
Prior to 2011, the responsibility for all decisions made concerning police injury benefits lay with the police authorities. In practice, the police authorities usually delegated the entire administration of injury benefits to their Chief Constable, who in turn delegated to a senior manager.
The Police Reform and Social Responsibility Act 2011 abolished police authorities in England and Wales, outside of London, on 22 November 2012 replacing them with directly elected Police and Crime Commissioners.
At the same time, the office of Police Pension Authority (PPA) was created. The new office of PPA took on the responsibilities formerly held by the police authorities.
The office of Police Pension Authority was vested in the sole personage of each Chief Constable (with different arrangements in London).
This naturally created the opportunity for a conflict of interest to arise. A Chief Constable was, on one hand, now supposed to be prudent with their force’s budget whilst on the other hand ensuring the scope and purposes of the police injury benefit scheme were promoted and nurtured.
It has proved to be a difficult, sometimes wilfully impossible, task for some Chief Constables to separate out the differing and often conflicting duties of a police pension authority from those of a Chief Constable.
A PPA should be blind to the cost implications of any decisions made regarding the grant or review of injury pensions. It would be entirely wrong, and contrary to the intent of the injury benefit Regulations if a PPA were to allow bias and partiality or irrelevant factors to enter and skew any decision-making process.
A PPA is entitled – even is under a duty – to ensure that injury benefits are paid only at the level to which the recipient is entitled to receive. In practice, some PPAs try to take this to extremes, by making it very difficult for injured officers to get an injury award, and by aggressively using the review provision within the Regulations to harass disabled former officers with a view to reducing their pensions.
Clearly, something needs to change. Either Chief Constables need to stop acting outside the law, or the responsibility for the injury benefit scheme should be handed, through new legislation, to a truly impartial and independent body.
We see no sign of the latter becoming reality, so it remains incumbent on injury on duty pensioners to do all that is necessary to protect their pension rights – and that usually means firstly standing up to errant Chief Constables, and, where they won’t listen to reason, taking them to court.