A firefighter who has not reached normal pension age (60) 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.
There are two tiers of ill-health pension, lower tier and higher tier. A minimum of 3 months' qualifying service is required for a lower tier ill-health pension and a minimum of 5 years' qualifying service for a higher tier ill-health pension. The medical conditions which have to be met, for entitlement to an ill-health award, are as follows:
- for a lower tier ill-health pension, the person must be incapable of performing any of the duties of the role in which last employed, because of incapacity of mind or body which will continue until normal pension age (60);
- for a higher tier pension, the person must be entitled to a lower tier ill-health pension and must also, because of incapacity of mind or body which will continue until normal pension age, be incapable of undertaking regular employment. Regular employment means employment for at least 30 hours a week on average over a period of not less than 12 consecutive months, beginning with the date on which the issue of the person's capacity for employment arises.
Determination of the award
It is the fire authority that will determine whether a pension can be paid but, to do so, they must first obtain and consider the written opinion of an Independent Qualified Medical Practitioner ("IQMP").
Within 14 days of making a determination of award, the authority must give written notice of it to the person concerned, together with a copy of the medical opinion upon which the determination was based. If dissatisfied with a medical opinion, here or at any subsequent review, a person has a right to seek a reconsideration of that opinion and, if still dissatisfied, has a right to appeal to a Board of Medical Referees.
The annual rate of a lower tier ill-health pension is calculated in the same way as an age retirement pension. This means that it is the sum of the amount of retirement earned pension and 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", i.e. the period beginning with the day after you retire and ending on the day before you reach normal pension age (60). No account is taken of any retirement added pension.
For example, suppose you:
- have an earned pension of £10,000 before commutation, £8,000 after commutation
- have an added pension of £1,000 before commutation, £800 after commutation
- have a period of 20 years between your last day of service and reaching age 60
- do not choose to allocate part of the pensions for a dependant.
Calculation of the lower tier ill health pension
If you retire with a lower tier ill-health pension, you would be entitled to:
the earned pension after commutation + the added pension after commutation
i.e. £8,000 + £800 = £8,800 a year
If you retire with a higher tier ill-health pension, you would be entitled to:
2% x the earned pension before commutation x 20
i.e. 2% x £10,000 x 20 = 4,000 a year
which is paid in addition to your lower tier pension of £8,800 a year.
Reviewing the entitlement
If an ill-health pension is awarded, for so long as the recipient has been receiving the award 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 to continue receiving the award.
To conduct the review, the authority would again seek the written opinion of an IQMP before making a determination as to whether the ill-health pension should continue in payment.
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 would cease with immediate effect. But a lower tier ill-health pension would continue in payment unless that must cease, too.
Continuing entitlement to a lower tier ill-health pension takes into account whether or not the recipient is considered to have become capable of performing the duties of the role from which they retired on grounds of ill-health. If it is considered that they have not, then the pension will continue in payment.
If it is considered that they have, then the authority must next consider whether or not to offer the person re-employment in the same role from which they retired. Then –
- 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, the authority would create a deferred member's account and credit it with an amount equal to the annual lower-tier ill-health pension immediately before it ceased. The deferred pension would come into payment at deferred pension age (State pension age or 65 if higher).