In a recent decision, the Deputy Pensions Ombudsman (DPO) decided that a delay of more than 5 working days in issuing a cheque for a transfer value was maladministration. This is despite the fact that legislation allows up to six months.


In this case, the member, a Mr Ingram, asked for a transfer value from his occupational pension scheme to purchase an annuity. The scheme's administrator received all the documents needed to complete the transfer on 25 September 2009. It was not until 19 days later (14 October) that they asked the scheme trustees to issue a cheque for the transfer amount.

Unfortunately, Mr Ingram died on 9 October and his IFA notified the scheme administrator of this on 15 October. His widow, Ms Jones, was offered a widow’s pension from the scheme. She complained that this was less than she would have received had the transfer been completed before Mr Ingram died.


The DPO upheld Ms Jones’ complaint. Significantly, she stated that there had been adequate time to make payment before Mr Ingram’s death as it should take no more than five working days to issue a transfer value cheque. Although payment was made within statutory timescales, this did not mitigate against a finding of maladministration. The DPO was also not influenced by the fact that the scheme administrator was only contractually obliged to process transfer values within statutory timescales.

The DPO directed the scheme administrator to pay an amount equal to the shortfall between the annuity cost of providing scheme benefits and the member’s transfer value together with £150 compensation for distress.


This case is the latest example of the Ombudsman deciding that there has been maladministration even though there has been no breach of a statutory duty. While there may be good reasons for taking longer than the 5 working days in this case for processing a transfer value request, for example where time is needed to disinvest funds, it is clear that in the absence of such reasons, the Ombudsman expects requests to be processed within a short timescale.

Where, as in this case, trustee approval is required to process transfers-out, they should ensure they have proper internal procedures in place for processing these without delay. Trustees should also check that they have agreed appropriate service levels with their scheme administrator.