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Time to think about your pensions

Last week&#39s column looked at the Financial Ombudsman Service and considered some points regarding the Mortgage Code Arbitration Scheme. This week I complete my look at MCAS and also consider the regulation of pensions.

MCAS is administered by the Chartered Institute of Arbiters and its use is free to complainants but lenders and intermediaries covered by the scheme must pay a registration fee, an administration fee and a fee based on the time spent on each case by the arbiter. As is the case for the FOS the scheme will not become involved until a firm&#39s internal complaints procedure has been exhausted. If the complainant is not satisfied with the outcome of the firm&#39s complaints procedure arbitration proceedings can be initiated by a joint application from the borrower and the firm, submitted by the firm together with the appropriate fee.

The scheme will not apply where either party has already initiated legal action.

As is the case for the FOS the maximum award that can be made is £100,000 and the arbitrator can decline to proceed if he believes the complaint to be &#39frivolous or vexatious&#39. Indeed, if the amount claimed is more than £100,000 the scheme will not become involved at all and the complainant must seek redress in the courts. Any award made under the scheme is binding on both parties and is not open to review, unlike the decisions of the FOS which are binding only on the firm and not on the complainant.

Moving on to the subject of pensions, the Occupational Pensions Regulatory Authority was created in 1996 and was given responsibility for the regulation of occupational pensions. OPRA is responsible for ensuring that schemes comply with legislation relating to occupational pension schemes. It operates in a reactive way which means that although it is able to initiate investigations and carry out spot checks, it works mainly through the investigation of reports about non- compliance and acts to ensure that matters are put right.

As far as complaints relating to occupational and personal pensions are concerned, the Pensions Ombudsman is responsible for dealing with complaints and disputes relating to the running of pension schemes with the exception of the state pension. Complaints about the sales and marketing of pension schemes are dealt with by the FOS. Students should note that the Pensions Ombudsman is not part of the FOS. Complaints and disputes can be referred by sources including managers, trustees and employees and employers. However, matters which are the subject of a complaint or dispute should first be referred to the pension scheme&#39s managers or trustees.

Complaints are related to maladministration and it must normally be shown that this has led to injustice e.g. financial loss, distress, delay or inconvenience.

Disputes are generally disagreements concerning facts or law. They normally arise incidentally to complaints about administration.

If reference of a complaint or dispute to a pension scheme&#39s managers or trustees does not result in agreement the next point of reference, before the Ombudsman, should be the Office of the Pensions Advisory Service. OPAS is a voluntary independent organisation funded by the Department of Work and Pensions through OPRA. Its aim is to help the public solve pension problems by means of a telephone helpline, letters or emails or through the involvement of one of a network of volunteer professional advisers. These advisers give advice and general information on a range of pension issues. They can also assist with complaints or disputes but will not become involved until a scheme&#39s internal complaints procedures have been exhausted without satisfaction. OPAS decisions are not legally binding and cases which cannot be agreed are referred to the Pensions Ombudsman.

Complains and disputes must be referred to the Pensions Ombudsman in writing within three years of the event being complained about. Any time spent trying to resolve the complaint using the internal complaints procedure or being assisted by OPAS is normally excluded from this.

Next week we will look at compensation arrangements for customers who have lost money through the insolvency of an unauthorised firm.


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