Lost Pension Arrears

A Review of Complaints to the Ombudsman Regarding Unpaid Arrears of Contributory Pension where the Claim is made Late

A Report to the Dáil and Seanad in accordance with Section 6(7) of the Ombudsman Act, 1980


This report is based on approximately 200 complaints, with a common theme, received since 1985. All of the complainants are pensioners who discovered that, because they were late in claiming a contributory pension, they were penalised with the loss of substantial pension arrears. The report sets out the Ombudsman's dealings with the Department of Social, Community and Family Affairs in relation to these complaints; it charts the slow progress made on the underlying problem which the complaints have identified; and it attempts to draw out the lessons to be learned from the overall experience. The report is a case study in administrative practice in a specific area but it has relevance for the practice and regulation of public administration generally.

Chapter Oneoutlines the specific issue underlying these complaints i.e. the practice whereby a person who is late in claiming a contributory social welfare pension (whether for widowhood or old age) can stand to lose substantial arrears of that pension. In one of the cases detailed, the pensioner had lost �36,000. This penalty applied even though the pension is a contributory pension; despite the fact that, historically, there has been significant confusion about pension entitlements and regardless of the reasons why the claim was late in being made. Chapter Two describes the operation of the penalty rules which applied to late pension claimants. It includes an account of discretionary powers available to the Department under which arrears could have been paid to the Ombudsman's complainants over the years, if only they (or the Ombudsman) had known there was such discretion.

Chapter Three outlines the deep-seated and persisting sense of grievance expressed over the years by the pensioners concerned. Unjust, unfair, immoral, mean-minded, fraudulent and duplicitous are just some of the epithets used by the affected pensioners. In order to convey the strength of feeling expressed, and to show the magnitude of the losses suffered, the report incorporates a series of verbatim extracts from letters written by these pensioners. These extracts are presented throughout the report as marginal inserts.

Chapter Four describes the Ombudsman's involvement with these complaints since 1985; it shows that the Ombudsman first flagged the issue as one requiring remedial action as far back as 1985 and that between 1985 and 1996 the Ombudsman continued to draw attention to the matter. In 1997 the Ombudsman published an investigation report on three test cases and this did lead to a considerable easing of the penalties for late claimants. However, this relaxation benefited only "new" cases and many of the pensioners who had complained to the Ombudsman - and whose cases caused the improvements to be made - were no better off. Eventually, in December 1998, the Department decided on a package under which these "old" cases got some limited compensation for the unpaid arrears.

Chapter Five summarises the outcome on some recent cases which benefited from a welcome flexibility in the interpretation of the penalty rules. This flexibility was uggested by the Ombudsman in his 1997 investigation report.

Chapter Six discusses a series of issues raised in the course of the Ombudsman's involvement since 1985. These have relevance for the Department, for public administration generally, for the Oireachtas and indeed for the Ombudsman's Office itself. The first of these issues is the fact that the severe penalties imposed on late claimants derived, not from the primary law as made by the Oireachtas, but from secondary law i.e. statutory instruments made by the Minister and passively acquiesced in by the two Houses of the Oireachtas. The Ombudsman suggests that these rules, had they been challenged in court, might well have been found to be invalid. A related point is that those affected, widowed and elderly people, are amongst those least likely to have been able to mount a legal challenge or to organise as a pressure group. The second, and related, issue is that there is no effective monitoring and supervision of secondary legislation by the Dáil and Seanad. Here the Ombudsman restates a view expressed before on a number of occasions. In particular, he cautions against the use of secondary legislation to regulate areas in ways which might prove controversial if dealt with through primary legislation. He suggests that a mechanism is urgently needed whereby the Dáil and/or Seanad can supervise the making of secondary legislation. A third issue raised in Chapter Six has to do with the use of discretionary powers. The Ombudsman says that, if discretionary powers are available, their existence should be publicised; they should be used in an open manner and within clear parameters in order to ensure conformity with Constitutional standards of reasonableness and fairness; and no discretionary option should be arbitrarily excluded. A fourth issue considered is whether the penalties described are incompatible with the nature of social insurance. The Ombudsman suggests that the penalties involved were not compatible with the concept of social insurance based, as it is, on the creation of entitlement by contributions paid and with its quasi-contractual nature. The fifth and final issue raised is in the form of a question: why was action not taken on this issue much earlier than 1997, given that it had been identified as a problem from 1985 onwards? The Ombudsman suggests that the Department's explanation, while understandable, was hardly acceptable in terms of basic fairness and of good practice. The lesson in all of this for the Ombudsman's Office is that, within its jurisdictional framework, it should seek to address systemic administrative problems more robustly and, if at all possible, more speedily.

This report deals with a long-standing practice on the part of the Department of Social, Community & Family Affairs ("the Department") whereby people who delay making a claim for a contributory pension are likely to end up losing considerable arrears of pension when the claim is eventually made. Pensioners caught in this trap are generally astonished, and ultimately very aggrieved, with this practice because their perception of a contributory pension - whether for widowhood or old age - is that it is an entitlement created by their own and their employer's social insurance contributions. The notion that they might lose substantial arrears of their pension, because of a delay in actually claiming it, is something they generally find quite astonishing. This is particularly the case in a context where most such pensioners believe this penalty has not been adequately publicised. Over the years, since 1985, the Ombudsman's Office has received several hundred complaints from, or on behalf of, pensioners who have lost out on arrears in this way. A typical example of these complaints is that of an elderly woman whose account, in her own words, is set out in Case No. 1. She had lost almost four years arrears of pension which amounted to more than �6,000. Many of the complainants lost considerably more than �6,000 in arrears; for example, in one of the cases mentioned in Chapter Five, the arrears eventually paid amounted to �36,000. Of course, there were also very many affected pensioners whose loss was less.

This Report

In 1997 the Ombudsman published a report (the "1997 Report" hereafter) on his investigation of three individual complaints from pensioners who had lost out on pension arrears. The purpose of this report is to present an overall account of the Ombudsman's engagement, since 1985, with this same issue of lost contributory pension arrears. There is probably no other individual issue in the area of administrative practice which has consistently, and for so many years, been raised with the Office. Because of improvements made with effect from 1997, the pensions' arrears issue is unlikely to continue to be of major concern to the Office. Accordingly, at this stage it seems useful to attempt to draw the lessons to be learned from the overall experience. There are lessons for the Department, for the Ombudsman's Office itself, and perhaps issues which will be of interest to the Dáil and Seanad. Accordingly, this report recounts the history of the Office's involvement with the issue, the various improvements which have been made up to the present, an analysis of some of the legal issues involved, as well as an analysis of the manner in which the Department has responded, over time, to the points and criticisms raised by the Ombudsman. In presenting this report to the Dáil and Seanad, the Ombudsman wishes to underline the importance of the issues which it raises. Bearing in mind the support which it has shown for the work of his Office, the Ombudsman is anxious to assist the Oireachtas by drawing to its attention deficiencies in the area of fair or sound administration. Finally, the report attempts to draw some general lessons which may have application in a much wider context.

Principally, this involves some reflections on the manner in which delegated legislation is made, and the extent to which it is effectively supervised by the Dáil and Seanad. In compiling this report, the Ombudsman was struck forcibly by the very strong sense of grievance expressed by virtually all of the pensioners concerned. As part of the report process, the Office reviewed a significant number of "late claims" complaints, paying particular attention to what the pensioners themselves have had to say. What emerges is a consistent sense of a serious injustice having been done. This theme is dealt with in some detail at Chapter Three. It must be a cause for concern that even a small minority of citizens should feel they are being treated unjustly by the State. That this perceived injustice continues to be felt over many years, compounds the problem. Finally, to the extent that this report is critical of the Department, the Ombudsman is happy to acknowledge that, for the overwhelming majority of its clients, their experience is of a service operating to high standards of professionalism and fairness. The issue dealt with in this report represents an historical problem which, in the light of developments in 1997 and 1998, has now been significantly ameliorated.

Case No. 1

"When I did apply in December 1985 [aged 70 years] to my surprise and dismay I received only three months back payment. I thought this was a most harsh judgement as over 40years - in times of extremely slim wage packets - I had paid my weekly contribution. ..I feel hard done by, as I am not seeking a hand-out - only requesting what is rightly myentitlement. " Letter of March 1997 to Ombudsman - this old age pensioner has lost almost four years arrears, amounting to �6,435. She did not claim pension until she finished employment at 70 years of age.

Case No. 2

 "I remember it being explained to me as far back as typing school that respectable parties to a transaction would never want to take advantage of a mistake on behalf of one party where it did not affect the legal position of the other party. ...I am sorry if this letter sounds petulant but I am absolutely furious that, in any civilised society, such a reply should be sent out by the Department of Social Welfare." Letter of June 1993 to the writer's local TD. She lost arrears of Contributory Widow's Pension for the period August 1984 - December 1992. Subsequently she was paid �7,000 arrears but this left �14,516 unpaid.

Prior to 1997 the Department operated a system under which, in the case of a contributory pension claim made late, arrears were limited to either three months or six months before the actual date of claim. This penalty system operated irrespective of the reason for the delay in claiming, irrespective of the total level of arrears being withheld and irrespective of the financial standing of the pensioner. In this context, a late claim meant a claim made outside of the "prescribed time". The "prescribed time" refers to the timescale laid down by the Minister, by regulation, for the making of a claim. In the case of Contributory Old Age Pension, the "prescribed time" is the period running from three months prior to reaching pension age at 66 years to three months after reaching 66 years. In the case of Contributory Widow's Pension, the "prescribed time" is the period of three months beginning from the date of widowhood. In effect, claimants had a grace period of three months after the date of potential entitlement - i.e. after reaching 66 years or after being widowed - in which to make their claim. A claim made outside this three month grace period would be likely to mean the loss of pension arrears other than for three months. The Department takes the line that requiring claims to be made within prescribed times is a feature of social security legislation in many countries. It is a requirement justified by the need to exercise supervision and control of claims and justified also by the requirements of sound financial management and control of public expenditure. The regulations in this area were quite complex. Whereas the basic rule was that arrears in late claims cases would be limited to three months, the regulations did contain a provision under which, subject to certain conditions, the three months limit could be extended to a six month limit. For this additional three months of arrears to be paid the pensioner had to show that, throughout the delay period, he or she had "good cause" for having delayed the claim. Prior to 1994, it was the general practice of the Department to pay only the three months arrears in late claims cases. In some instances, indeed, it did extend the arrears to six months but only where the pensioner made a specific case that he or she did have good cause for the failure to claim within the prescribed time. In December 1994, and partially at least in response to pressure from the Ombudsman's Office, the Department adopted the general practice of paying six months arrears in almost all such late claims cases, following an amendment of the relevant regulation.


In 1996 the Ombudsman's Office discovered, by chance, that the Department had a long-standing arrangement with the Department of Finance under which lost arrears of contributory pension could be paid on an extra-statutory basis. In effect, this was a recognition that the regime laid down by regulation could give rise to unfair outcomes in certain situations. The terms agreed with the Department of Finance allowed for payments in a number of situations, including some purely technical scenarios e.g. where pension orders were presented but not paid at the time, where a claim was actually made on time but payment was not obtained "within the prescribed time due to official causes". Of most relevance in the context of the Ombudsman's complainants, however, was the provision which enabled payment: "in any other circumstances in which the Minister for Social Welfare is satisfied that payment should be made in equity or to avoid undue hardship (provided no doubt exists as to entitlement to pension at the material time)." This provision offered very real discretion given, in particular, the scope of the term "equity". It seemed to the Ombudsman that, had his Office been aware of this provision over the years since 1985, very many of his disappointed "late claims" complainants could have had the penalty of lost arrears reduced or removed. However, the Department's position was that these provisions were invoked "very infrequently and only under the most restricted circumstances which arise from a case of proven error or proven misinformation on the part of the Department or where the person was simply incapable by reason of illness of making a claim." Perhaps the most striking feature of the extra-statutory arrangement was that, in effect, it was kept secret! Pensioners who were being refused substantial arrears were not told that there were grounds on which some or all of the arrears might be paid. Nor was the Ombudsman's Office in a position to advise such pensioners that there might be a case to be made on the grounds, for example, of hardship or of medical incapacity. The Department appears to have taken the view that consideration of arrears on extra-statutory grounds would arise only where the pensioner persisted in seeking arrears and where the pensioner set out grounds which equated with the grounds on which extra-statutory payments might be made. In a sense, the pensioner had to be lucky enough to identify the type of ground which might trigger the extra-statutory mechanism. Needless to say, most pensioners concerned were not so lucky. Because they were unaware of what might constitute grounds for further arrears payment, there was no encouragement to argue for further arrears. Case No. 3 is a good example of this type of situation. Following her complaint to the Ombudsman in 1993 the complainant was paid additional arrears of three months. At the time, she explained that she was simply unaware of her entitlement and did not apply for that reason. However, in September 1998 - following publicity on the issue generated by the Ombudsman's on-going involvement - she re-opened her arrears claim with the Department. She said that, shortly after being widowed in 1987, she had been advised by a local official of the Department that she did not have any pension entitlement. She contended this was a major factor in her failure to make a claim in 1987. The Department investigated this contention and satisfied itself that it was well based. The outcome was that the Department then paid her all the outstanding arrears - almost �12,000 - and paid compensation of �2,503 for good measure. The point here is that, had the Department been open about the option to pay arrears on an extra-statutory basis, this widow could have made a successful case in 1993 rather than in 1998.

Practice Since 1997

In the case of late contributory pension claims made after 1 January 1997, the penalty of loss of pension arrears has been modified. This softening of the penalty was brought about by an amendment to social welfare law introduced by the Social Welfare Act, 1997 which, in turn, was backed up by a regulation made by the Minister in February 1998. This new arrangement, which is the current one, resulted from the Ombudsman's 1997 Report and it represents a considerable improvement on the situation prior to January 1997. There are three components to this arrangement. Firstly, arrears for up to 12 months of the delay period are paid in full. Secondly, where the delay period exceeds 12 months, arrears for the period beyond the first 12 months are paid on a proportionate, sliding (reducing) scale. Thirdly, there is the possibility of additional arrears, on a discretionary basis, in the following type of circumstance:

  • where the delay in claiming was the result of bad advice given by an official of the Department;
  • where the delay arose because the pensioner, due to medical incapacity, was unable to manage his or her own affairs;
  • where the pensioner was prevented from claiming because of a force majeure type situation i.e. events or actions to which the pensioner was subject and which, by their nature, were so overwhelming or catastrophic as to make it impossible to have lodged a claim;
  • where the pensioner is currently suffering financial hardship and has a level of financial indebtedness which cannot reasonably be met from current income or the disposal of assets.

As is evident, this is a complex formula which provides for a specific number of additional weeks arrears as well as the possibility of further arrears on a discretionary basis. To an extent, the discretionary provisions attempt to cover come of the ground previously covered by the extra-statutory arrangements. For example, to take the example of Case No. 1 (see Chapter One), had the pensioner applied in January 1997 or later (rather than in 1985), she would have received a total of 114 weeks arrears rather than the 13 weeks arrears she originally received. This is assuming that no additional arrears would be paid on one of the discretionary grounds listed above. (She also received 47 weeks additional arrears in December 1998.) Clearly, the current arrangement is very much better than the previous one. Nevertheless, even under the new arrangement, this pensioner would still have lost 94 weeks of arrears because of her failure to claim on time. This improvement was a direct response to the criticisms which the Ombudsman had been making over the years. In particular, it was a response to the findings and recommendations of the Ombudsman's 1997 Report. However, these new arrangements, welcome as they may have been, had one major drawback. They did not apply to those pensioners whose late claims were made prior to 1 January 1997. It was ironic that those pensioners, whose complaints caused the Ombudsman to draw attention to the overall problem, were now being excluded from an improvement brought about by their efforts.

Initiative of December 1998

Throughout 1998 the Ombudsman remained in contact with the Department regarding the cases of those pensioners whose late claims were made before 1 January 1997 and who had not benefited from the new regime. It was the Ombudsman's position that some type of equitable solution would have to be found for this group, many of whom had suffered very significant losses. The Department's position was that the improved arrangements could not be applied retrospectively and that those pensioners who claimed before 1 January 1997 got precisely what the then prevailing law provided for. In any event, the Department felt the costs of any retrospective application of the new arrangements would be prohibitive. The Department calculated that the improved arrangements would cost �1.7m per year on a current basis and that to apply these arrangements to "old" cases could cost up to �27m. However, the Department did undertake to look at the possibility of making some further arrears payments to the "old", pre -1997 cases.

In the event, the Budget of December 1998 provided an allocation of �10m towards the costs of a partial arrears payment to the "old" cases. Under this Initiative an amount, equivalent to 50% of what would have been paid under the improved arrangement, was to be paid to the "old" cases. It is to the credit of the Department that it decided these additional arrears should be paid in all of those "old" cases which they could identify, and where pension was still in payment. The benefit is not being confined to those pensioners who had directly made a case to the Department or to the Ombudsman. The process of identifying potentially eligible pensioners, of deciding on their entitlement (if any) and calculating the arrears due, is still under way within the Department. This process is likely to continue throughout 1999. By mid May 1999 the Department has paid out proportionate arrears under the Initiative in 706 cases (comprising 471 widows' cases and 235 old age/retirement cases) at a total cost of �1.34m. The smallest arrears amount paid so far in an individual case is �30 while the largest such payment is �9,232. The average payment to date is �1,901. Based on the cases dealt with so far, the average "base arrears period", i.e. the period for which pension has not been paid, is 3.9 years in the case of old age pension and 4.9 years in the case of widow's pension. One extraordinary case has come to light in the course of this exercise, that of a widow who failed to claim her Contributory Widow's Pension over a period of more than 44 years! She was widowed in 1945 but did not claim the pension until 1989 when she had pension awarded with six months arrears. In 1998, following publicity in relation to the pension arrears issue, she contacted the Department herself seeking additional arrears. Her entitlement under the Initiative was to an additional 134 weeks of payment, amounting to �6,500. In the course of the Initiative so far, the Department has identified 52 cases - 39 widow(er)s and 13 old age cases - in which full arrears were found to be payable. The average payment here was �3,912 and the total cost was �203,448

It is important to bear in mind that, welcome as it may have been, the Initiative of December 1998 represented only a very partial response to the overall problem. From the individual pensioner's perspective, the proportion of arrears now being paid was quite low. For example in Case No. 5, the widow concerned was paid a further �2,018 whereas she had lost more than five years (1983 - 1988) arrears of pension. What she was paid in December 1998 amounted to 15% of the total arrears then outstanding; more than �11,000 of arrears remained unpaid. In Case No. 6 the widow concerned is at an even greater loss. She contends that, even allowing for the payment she received in December 1998 (which amounted to �4,198, or 13% of the total arrears) she is still at the loss of about �28,000 in pension entitlement. In fact, the outstanding arrears amount in her case exceeds �29,000. In the extraordinary case of the widow who did not claim until 44 years after being widowed, more than 41 years of pension remain unpaid. In the light of this level of financial loss, it is easy to see that many of these pensioners remain very aggrieved. However, for the majority of pensioners affected it is not proposed to pay further arrears. These are the pensioners whose failure to claim on time is explained solely by lack of knowledge of their entitlement and who cannot make a case based on hardship, medical incapacity or misinformation by the Department.

Case No. 3

"My story is as follows: My husband died [in] August 1987 following ashort ...illness. I was left with three sons...My husband and I ran a small...shop....This was my only source of income [Not until 1993 did she discover her entitlement to Contributory Widow's Pension, which she then claimed]. However the problem is that they decided to backdate [the pension] only to March 1992 ... The Department claim that they will only backdate a claim by three months. This I think is grossly unfair, as if I had known at the time of my husband's death I would have applied then...I have calculated that I am due approximately over �12,000.." Letter of May 1993 to the Ombudsman.

Case No. 4

"At the time of my husband's sudden death in November 1990 I was very shocked and distraught and, much to my consequent regret, did not question information by the Department of Health or [her late husband's employer] when they told me I was not eligible to any pension except the [occupational pension]. You will understand I feel very aggrieved and feel on moral grounds and in equity I should be given favourable consideration." Letter of May 1997 to the Ombudsman - the writer lost more than three years' arrears of Contributory Widow's Pension, totalling more than �7,000.

Case No. 5

"I am a widow since February 1983...Unfortunately, I was not aware until recently that I was entitled to a widow's pension from my own PRSI. I applied and was granted a pension back dated [for six months] only. Surely if I was not aware of my entitlement the Department cannot justify not granting me my pension from the time I became a widow... The Statute of Limitations does not apply to income tax, surely the same must apply in this case." Letter of May 1989 to the Ombudsman - the writer lost more than five years' arrears of Contributory Widow's Pension. In 1998 she received additional arrears of �2,018 leaving �11,099 arrears unpaid.

Case No. 6

"I believe I am entitled to [pension arrears] in justice....when, after all, this money is not the State's but mine -regardless of what failures in application procedures there were. ...Between 1975 and 1994 I estimate I lost roughly �33,000 in pension entitlements and received to date �4,800 roughly in back-payment, leaving a loss of some �28,000....I have no home, no assets and have only a fragile grip on a job. I hope you will see your way to granting me what is, I believe, due to me. " Letter of January 1999 to the Department - the writer was widowed in 1975 but did not claim Contributory Widow's Pension until 1994. She was unaware of her entitlement until then.

Representing the Complainant's View

The Ombudsman does not always agree with the complainant's perception of having been wronged. Indeed, as the statistics published in each year's Annual Report show, in roughly 50% of all cases the complaint is either not upheld or discontinued. Conversely, the fact that the Ombudsman cannot uphold a complaint does not necessarily mean that he does not share the complainant's sense that an injustice has been done. It may well be the case that the action complained of is fully in line with the law but that the law itself, in certain contexts, gives rise to an injustice or an unfairness. In such situations, an Ombudsman is generally unable to uphold the complaint but can draw attention to the unfair operation of the law. It is also appropriate for an Ombudsman to give expression to the sense of grievance which is being articulated by complainants. This is particularly the case where the grievance in question is a recurring one and where those affected are, whether because of age or social status or for other reasons, unable to organise themselves at the political or lobby group level. It is perhaps worth remembering that one of the connotations of the term "Ombudsman", which we have borrowed from the Swedish context, is that of being a "representative" of a particular group. In reviewing complaints received over the years on the issue of lost arrears of contributory pension, the Ombudsman was struck by the very strong and enduring sense of grievance which characterizes almost all of them. Furthermore, this sense of grievance has been expressed in remarkably similar ways over the years by complainants. It also comes across that many of these complainants recognise their inability to organise a common platform with other similarly affected people; that, in effect, they are on their own. By definition, the people affected here are either elderly or widowed and this must at least diminish the chances of being able to lobby successfully on an organised basis. This sense of being on their own appears to compound the underlying grievance. It is noteworthy in the present context that no High Court action has ever been taken by an aggrieved pensioner who has been refused arrears of contributory pension. Perhaps this inaction is not so much a reflection of weak legal arguments as a reflection of the inability of those concerned to muster the resources to mount a legal challenge. (For consideration of the strength of the Department's legal basis, prior to the enactment of the 1997 Social Welfare Act, see Chapter Six.) In this context the experience of the non-implementation of the EU Equal Treatment Directive (in relation to social security payments) is instructive. Those Irish women adversely affected by the failure to fully implement the Directive were able ultimately to mount a campaign at both the political level and by way of court action. Their cause attracted support at the political level and from within the legal profession and, in time, this campaign was successful. Approximately 60,000 Irish women ultimately benefited. By comparison, the scale of the late pension claims problem is considerably smaller. The Department itself conducted a survey three years ago which suggested a figure of 850 late contributory pension claims each year with about 600 of them being late by more than 12 months. This should be a declining figure, over time, as the

Department's information services and advance notification capacity develop. However, it would probably be conservative to estimate the numbers affected as amounting to at least 15,000 over the past 30 years. Of these, perhaps as many as 200 pensioners have brought their complaint to the Ombudsman's Office. It is important that these complainants should be afforded the opportunity to have their voices heard. Accordingly, considerable space in this report is devoted to the inclusion of direct comments by some of these pensioners. The overall trend of these comments is summarised later in this chapter and the actual comments are included throughout the text in the page margins. The pensioners are not always strictly accurate in what they have to say, but their sense of justified grievance does come across very clearly.

Reasons for Late Claims

For the majority of the complainants, the failure to claim pension on time arose primarily from their lack of knowledge of the social welfare system. Very many of them make the point, as if it were necessary to make it, that they certainly would have claimed on time had they been aware of a potential entitlement. A significant sub-group were public servants (including teachers), or the spouses of public servants, who shared the widely but mistakenly held view that public servants are effectively excluded from social insurance benefits. Another significant sub-group were widows who, because of the trauma of being widowed contended that they were unable to look after their financial affairs properly for some years following widowhood. Some of these widows complain that the Department has been quite unsympathetic in its approach to their cases. A smaller sub-group again are those who claim that they were given incorrect advice as to entitlement either by the Department itself, by a professional adviser (such as an accountant), or by a public service employer (whose expertise on these matters they felt it reasonable to rely upon). The Ombudsman's Office has come across only one instance in which the pensioner deliberately failed to claim on time and, in effect, decided to leave his pension "sit" in the Department's coffers as if on deposit in a bank. Perhaps most unfortunate of all is the case of the altruistic pensioner (Case No. 8) who, though aware of his entitlement, decided in 1986 to postpone his claim on the grounds that the State was in an economic depression and that he would delay his claim until times improved; he did expect that he would get arrears when he did claim. On claiming in 1990 he found that he was to be deprived of three years arrears of pension. In his 1997 Report the Ombudsman considered the contention of many complainants, that information in relation to social insurance benefits was not always readily accessible in the past and that, in particular, the Department had failed to adequately alert people to the penalties associated with a delayed pension claim. One of the General Findings of that Report was that "the Department has not adequately publicised the penalties in operation in the case of contributory pension claims made late". So even if people were aware of a pension entitlement, it is quite unlikely they would have realised there was a very major penalty attaching to a delayed claim.

Department's information services and advance notification capacity develop. However, it would probably be conservative to estimate the numbers affected as amounting to at least 15,000 over the past 30 years. Of these, perhaps as many as 200 pensioners have brought their complaint to the Ombudsman's Office. It is important that these complainants should be afforded the opportunity to have their voices heard. Accordingly, considerable space in this report is devoted to the inclusion of direct comments by some of these pensioners. The overall trend of these comments is summarised later in this chapter and the actual comments are included throughout the text in the page margins. The pensioners are not always strictly accurate in what they have to say, but their sense of justified grievance does come across very clearly.

Reasons for Late Claims

For the majority of the complainants, the failure to claim pension on time arose primarily from their lack of knowledge of the social welfare system. Very many of them make the point, as if it were necessary to make it, that they certainly would have claimed on time had they been aware of a potential entitlement. A significant sub-group were public servants (including teachers), or the spouses of public servants, who shared the widely but mistakenly held view that public servants are effectively excluded from social insurance benefits. Another significant sub-group were widows who, because of the trauma of being widowed contended that they were unable to look after their financial affairs properly for some years following widowhood. Some of these widows complain that the Department has been quite unsympathetic in its approach to their cases. A smaller sub-group again are those who claim that they were given incorrect advice as to entitlement either by the Department itself, by a professional adviser (such as an accountant), or by a public service employer (whose expertise on these matters they felt it reasonable to rely upon). The Ombudsman's Office has come across only one instance in which the pensioner deliberately failed to claim on time and, in effect, decided to leave his pension "sit" in the Department's coffers as if on deposit in a bank. Perhaps most unfortunate of all is the case of the altruistic pensioner (Case No. 8) who, though aware of his entitlement, decided in 1986 to postpone his claim on the grounds that the State was in an economic depression and that he would delay his claim until times improved; he did expect that he would get arrears when he did claim. On claiming in 1990 he found that he was to be deprived of three years arrears of pension. In his 1997 Report the Ombudsman considered the contention of many complainants, that information in relation to social insurance benefits was not always readily accessible in the past and that, in particular, the Department had failed to adequately alert people to the penalties associated with a delayed pension claim. One of the General Findings of that Report was that "the Department has not adequately publicised the penalties in operation in the case of contributory pension claims made late". So even if people were aware of a pension entitlement, it is quite unlikely they would have realised there was a very major penalty attaching to a delayed claim.

Grievances in Summary

There is a series of common themes behind the individual expression of grievance by these complainants. They variously described the decisions of the Department as

  • unjust and inequitable
  • immoral and discriminatory
  • disproportionate (in terms of a penalty for claiming late).

Many complainants spoke explicitly of having an absolute entitlement to arrears, because of the nature of the social insurance "contract". These people referred to having paid social insurance over a lifetime; to their employers having paid social insurance for them also; and to their belief that they had a legal and moral right to full arrears. (See Chapter Six for a summary of the Department's position on social insurance; this position is represented in detail in the 1997 Investigation Report.) Many drew attention to the double standard - as they perceived it - operated by the State. On the one hand, the State is bound by no time limits when it comes to collecting tax retrospectively; but it applies a different standard when it comes to paying arrears of pension from the Social Insurance Fund to ordinary people. As one person put it, employees are required by law to pay social insurance; but the Department appears not to be required by law to pay all of the corresponding social insurance entitlements. A number of complainants felt that their contribution to society, by way of a lifetime of employment (more than 40 years in many cases), was being devalued and disregarded. Not surprisingly, virtually none of the complainants was able to argue in relation to the legal validity of the regulations under which arrears were being withheld; but many of them did make the point that the Department's reliance on these regulations amounted to hiding behind technicalities.

Other points made by complainants included:

  • the State has granted tax amnesties to those who have failed to pay their legally due taxes; but it has reneged on its obligation to pay pension arrears to those with legal entitlement.
  • the State has collected social insurance under false pretences and has exploited pensioners' ignorance in order to save money; this amounts to fraud.
  • the net cost of paying pension arrears is less than appears the case as many pensioners would be liable for income tax in relation to the arrears.
  • the State has had the "use" of the pensioners' arrears during the period of non-claim.
  • the scale of the financial loss, from the individual's perspective, is very significant in many cases - even after the payment of partial arrears under the initiative of December 1998.


Finally, there is a particular anomaly applying in the case of widows who, if they happened to be in employment during the period of non-claim, would have been exempt from the payment of the employee portion of social insurance (including the health contribution and the employment and training levy) had they been receiving the Contributory Widow's Pension. These people suffered a double penalty - the non-payment of their pension coupled with the actual payment of social insurance from which they should have been exempt. This anomaly also affected widows who may not have been in employment but who would have been liable to pay the health contribution and the employment and training levy; had they been receiving the Contributory Widow's Pension they would have been excused this liability. A graphic response to this anomaly is expressed by one of the complainants, a widow, who would have been eligible for Contributory Widow's Pension in 1975 but did not make a formal claim until 1985; arrears for the period 1975 - 1984 remain unpaid. The comments below are from a letter she sent to the Collector General's Office in November 1985 in response to a bill for outstanding health contributions and employment and training levies: "You mean to tell me, if I had collected my widow's pension from January 1975 I would not have to pay these levies... But because I did not collect and have been out of pocket... about �20,000, which one of you Departments have benefited by, you now expect me to pay �941. Words fail me, a ten year old child could work that one out. .....does it simply mean the Revenue Commissioners can demand money from me, which I do not owe, but I cannot demand money which is rightfully mine. So much for our democracy!"

Case No. 7

"When my husband died my two children...were only 17 and 7 months respectively. My income was very small and things were very, very difficult for me. Both my parents were dead and my husband's family lived (abroad)....Due to no fault of my own I have been deprived of (Contributory) Widow's Pension for the past18 years and this caused me considerable hardship and deprivation all during that time...I consider that I am both morally and legally entitled to back payment of my pension to the date of my husband's death in ...1965." Letter of May 1983 to the Department. In 1995 she complained to the Ombudsman and this resulted in all arrears being paid, 12 years after she claimed and 30 years after being widowed.

"The rules governing social welfare pension payments are becoming so byzantine that even getting the correct advice from the Department itself is becoming more difficult" "Your Money" Column, The Irish Times 14 May 1999

Case No. 8 "I have paid tax and PRSI for 40 years...Since PRSI is acompulsory insurancepolicy imposed by the Government, then I think the Government shouldhonour that policy ...and not renege on it on a mere technicality. I feel I have been very badly treated; all the more so when I saw that the Government, who were withholding my pension money were, at the same time, granting [tax] amnesties...My pension is very small compared to the sums involved [in the tax amnesties].."

Letter of October 1996 to the Ombudsman - the writer lost about three years' arrears of Contributory Old Age Pension. The current amount of unpaid pension arrears is �8,241.

"Despite genuine advances in the Department's information services over the past decade ...it remains thecase that many people are ill-informed in relation to social insurance matters. Perhaps the simple explanation for this is that the social insurance system is extraordinarily complicated and it may be unreasonable to expect people to inform themselves adequately."

from Ombudsman's Investigation Report of 1997

Case No. 9

"To me it seems like fraud if I am to lose three years of my [old age] pension because I did not know that I was entitled to it. To my way of thinking, this is an infringement of Civil Rights (for) a man who has spent all his working life paying contributions (about 42 years) to find in his old age that he is deprived of what is rightfully his."

Letter of June 1997 to the Ombudsman - the writer has lost about 2.5 years' pension arrears, totalling �6,965

The Ombudsman's Office began operations in 1984 and, from the very outset, issues in relation to contributory pensions were raised. In the early years, the so-called "averaging" problem in relation to Contributory Old Age Pension generated a great number of complaints. "Averaging", in a nutshell, referred to the problem whereby there was no necessary, consistent correlation between the level of social insurance paid over a working life and entitlement to the pension. (Due to the vagaries of social welfare law, as it then stood, it could happen that a person with a lesser record of insurance could qualify whereas a person with a greater record might be ineligible. To some extent, when one paid social insurance could be more important than how much insurance one had actually paid.) Ultimately, in 1988, this problem was largely overcome with the introduction of a system of pro-rata pensions. However, the "averaging" problem was not the only significant contributory pension problem to be raised in the early years of the Office. The issue of lost arrears of contributory pension, where the claim was late, was raised almost from the outset. In fact, the two issues had a lot in common. In both instances complainants thought of the pension as an entitlement which they (along with their employers) had created through their social insurance contributions; and in both instances complainants regarded the rules which denied them pension, or penalised them for a late claim, as being arbitrary and unfair.

Annual Report Coverage

Arising from a number of complaints received, the Annual Report of the Ombudsman for 1985 drew attention to the difficulties created by the "late claims" rules (see opposite). The then Ombudsman, Michael Mills, suggested that the penalty rules should be relaxed if it remained the case that the Department could not notify people of a potential entitlement. This suggestion did lead to some discussion on the matter in the Seanad in 1986 . The Minister for State at the Department of the Public Service had this to say: " The Department of Social Welfare have pointed out that every effort is made through leaflets and other sources of information to ensure that people are aware of their entitlements and of the necessity to claim within the required time limits. They have also indicated that the question of amending the time limits for contributory pension claims is under examination in the Department."

Seanad Debates, 2 October 1986

Between 1985 and 1996 the "late claims" problem featured, whether in the form of a report on a specific complaint or as a general issue, in almost each year's Annual Report of the Ombudsman. Throughout this period the Office reluctantly took the view that, whereas the pensioners in question were being treated unfairly, the Ombudsman had to recognise that the Department's actions were in accordance with the regulations. This meant that the Ombudsman could - and did - suggest that the regulations be changed but, pending that change, individual complaints could not be upheld.

As the years went by, and as it appeared that the Department had made no serious move to soften the very harsh penalty system, the Ombudsman's Office was forced to re-appraise its position on the issue. The development of this new approach was well charted in Annual Reports from 1993 onwards and it co-incided, in any event, with a more general re-appraisal of the Ombudsman's approach to complaint investigation. In his final Annual Report (for 1993) the first Ombudsman, Michael Mills, applied the test of proportionality to the penalty system then in place - see opposite. He concluded that the Department's practice clearly failed to meet this test and that there was no reasonable proportion between the penalty being imposed on the pensioner (substantial arrears lost) and whatever detriment might result for the Department where a pension claim is made out of time. In October 1994, arising from a Dáil Question, the attention of the Minister for Social Welfare was drawn to these observations of the Ombudsman and a response was sought. In the course of his response the Minister mentioned: "In many cases it would be very difficult to carry out the necessary checks on entitlement if the period for claiming were to be extended. The vast majority of cases are covered by the six months limit. I am, however, reviewing the present arrangements to see whether any changes are warranted. "

Dáil Debates, 20 October 1994

Clearly, not a great deal of progress on the issue appears to have been made within the Department in those eight years between 1986 and 1994. In his Annual Report for 1995, the present Ombudsman, Kevin Murphy, developed the proportionality test further and commented that the penalty system was being applied in a blanket way, with no consideration being given to the reasons why pensioners might be late with their claims: "I [am] concerned that pension entitlements, based on social insurance contributions, can be lost simply because there was a failure to apply in time without due regard to the reason for the failure to apply. In my view, the penalty imposed by the regulations is, in many cases, too severe. Some ...complainants say that they were unaware of their entitlements. It seems to me that the social welfare system has now become so complex that it may no longer be sufficient for the Department to put the onus on ordinary citizens to be aware of their rights and entitlements." By the time this Report was published the Ombudsman had already begun an investigation into three particular "late claims" cases. These cases were investigated, and reported on, together and they provided a vehicle for the further development and articulation of the Ombudsman's approach to the issue.

Investigation Report of 1997

In undertaking these investigations the Ombudsman was conscious that it would be necessary to confront the fundamental obstacle which had, hitherto, inhibited finding in favour of this type of complainant i.e. the fact that the decisions complained of complied with the regulations and that the Department's position was that these decisions were, by definition, correct. This inevitably led the Ombudsman into a consideration of the nature of regulations (or secondary legislation) in general and of the "late claims" regulations in particular. Furthermore, the question of the Ombudsman's jurisdiction would require to be clarified where the action complained of, by inference at least, included the making of the regulations which were giving rise to the impugned decisions. In March 1997 the Ombudsman published his Report of Investigation of Complaints against the Department of Social Welfare regarding Arrears of Contributory Pensions in cases where the claim is late. Copies of this report are available from the Ombudsman's Office and the text is also on the Office website (www.irlgov.ie/ombudsman/). In effect, this was a dual report insofar as it dealt with three individual pensioners' complaints but also dealt with the lost arrears issue in general terms. For present purposes, it is the general aspect of the report which is of relevance. A short summary of the outcome on some of these general aspects is set out below.


For the Ombudsman's jurisdiction to apply, there must be an administrative action taken by a relevant body which, on the face of it, has or may have adversely affected a person. One of the conclusions of the report - though not presented as a formal finding - was that the Ombudsman is not precluded from criticising the provisions of a regulation, or indeed an entire regulation, where he is of the opinion that it is the regulation itself which is the primary cause of the adverse effect. This does not mean that the Ombudsman has a roving brief to scrutinise the provisions of regulations. Rather, it means that

  • where a person has been adversely affected by an administrative action (e.g. a decision to refuse pension arrears),
  • and where that action is required by a particular regulation,
  • and where the application of the regulation appears to the Ombudsman to match one of the seven categories of maladministration listed at Section 4(2)(b) of the Ombudsman Act, 1980

then the Ombudsman's jurisdiction applies in the normal way. In the context of the pension regulations which governed the "late claims" issue up to 1997, it appeared to the Ombudsman that these regulations may not have been made within the boundaries of the delegated authority given to the Minister by the Oireachtas. In other words they may, in legal parlance, have been ultra vires (beyond the powers of) the Minister.

In this event, the individual impugned decisions made under the regulation would have been "taken without proper authority". This is one of the specific categories of maladministration against which, under Section 4(2)(b) of the Ombudsman Act, 1980, actions must be tested. Alternatively, if the Ombudsman concluded that the decisions required by the regulation were unfair or unreasonable then those decisions might be found to be "contrary to fair or sound administration" which is the residual category of maladministration proposed at Section 4(2)(b) of the Ombudsman Act, 1980. A related issue concerns a situation in which redress might only be possible following amendment of a regulation. Bearing in mind that his jurisdiction does not extend to judicial or legislative actions, the question here is whether the Ombudsman would be within his powers in recommending, following investigation, that a regulation be amended. In relation to this - though it was unnecessary to reach a conclusion in the particular cases - the Ombudsman felt that he could, where necessary, recommend that the body either consider the matter (viz. the impugned regulation) further or else take action in relation to it.


In two of the three cases covered by the investigation report, the pensioners concerned had actually been receiving a lower rate social welfare payment for a period during which they could have been receiving the higher rate Contributory Old Age Pension. For example, in one case the pensioner had been on a widow's pension for some seven years after reaching 66 years; she complained when the Department refused to pay arrears of the Contributory Old Pension (in fact, the difference between the widow's and the old age pensions) for that period. The Department's position was that the regulations did not allow payment of the Contributory Old Age Pension other than for six months prior to the actual date of claim. In this the Department was maintaining a position adopted in many such cases over the years. It appeared to the Ombudsman that, even within the strictures of the regulations as they then stood, there was sufficient flexibility to enable the Department to treat a claim for a pension already in payment (e.g. widow's pension in the example above) as satisfying the requirement to have claimed some other, higher rate, pension (e.g. Contributory Old Age Pension in the example above). Accordingly, the Ombudsman made a finding to this effect in his investigation report. The Department accepted this finding at the stage of responding to the draft investigation report. In the case cited above the pensioner was paid arrears of �2,200 and the Department applied this new approach to a number of other similar cases on hands. To the credit of the Department, it chose to apply this new interpretation liberally which resulted in substantial arrears being paid in a number of other cases. A related and very welcome development is that the Department now accepts that receipt of some other payment (for example, Disability Benefit), up to the point of reaching old age pension age at 66 years, may be treated as satisfying the requirement to have claimed the old age pension at 66 years. In effect, a person who is a "client" of the Department on reaching 66 years will be deemed to have claimed the old age pension at that point. (For an example of this approach see Chapter 5 ).


In its response to the investigation report at draft stage, the Department indicated that the Minister would propose an amendment to the Social Welfare Acts to provide for the "late claims" penalty regime in primary, rather than secondary, legislation. This was in response to the view that it was inappropriate to provide for such far-reaching penalties in secondary legislation. In due course the primary law was amended by Section 32 of the Social Welfare Act, 1997. This provides the basis for the current, considerably improved, regime which has already been outlined in Chapter 2.

"I received a number of complaints from people who did not apply for contributory pensions, for which they qualified, because they were not aware of their entitlements or that a time limit would be applied. The Department .. do not notify insured persons of their entitlement ...Generally, ignorance of the rules relating to the time limits and the pension schemes is not accepted as a good reason for delay. Many of the social security institutions of our fellow members of the EEC advise people coming up to pension age of their entitlements and invite them to claim. This seems a much fairer system. I think it only reasonable that people having paid contributions should be informed, in advance, of their entitlements. If this is not feasible, consideration might be given to the question of whether the law should be amended to relax the time limits applying to contributory pension claims." Annual Report of the Ombudsman, 1985

"It seems to me that in cases involving an entitlement to benefit which is established on the basis of social insurance contributions, the operation of the statutory provisions regarding the commencement date of payment, can give rise to significant inequities. I am also of the view that pension entitlements, based on social insurance contributions, should not be lost simply because there was failure to apply in time, without due regard to the reasons for the failure to apply. ... It would appear that the penalty being imposed in this kind of case is totally out of proportion to whatever "fault" may have occurred. The principle of proportionality is a feature of European Union law and one which may well evolve as a feature of our public law. The present arrangements would appear to be out of step with this principle."

Annual Report of the Ombudsman, 1993

Case No. 10

"It is extraordinary that the State should (a) decide that a pension properly ...payable from a certain date is deemed to be not payable from that date because the potential recipient, unaware of his rights, did not claim on ... that date; (b) take advantage of the pensioner's ignorance in the matter by arbitrarily curtailing their claim to six months arrears; and (c) adopt this haggling attitude when so little is involved - in my own case arrears ...would only amount to a net �1,900 -after tax @ 48% is deducted." Letter to Department, July 1996

Case No. 11

"Two standards exist in that there is no restriction on the period that the Revenue, for example, can look for back payment, whereas I am restricted to a back payment of six months"

Letter to Taoiseach (copy to Ombudsman) of October 1996

This chapter gives brief summaries of some "late claims" complaints which have been resolved satisfactorily in the past 12 months or so. These cases, which have not been reported on before, illustrate the persistence required on the part of aggrieved pensioners in order to have their arrears paid. In fairness to the Department, these cases also show that where a case is well made it is prepared to look afresh at the matter and, in many instances, give the pensioner the benefit of the doubt. These cases also illustrate the effect of some of the new developments in the Department's overall approach. However, the fact that some pensioners have been successful with their arrears claims is little consolation to those pensioners who have not succeeded in making the same type of case but whose lost arrears may be every bit as significant.

�36,000 Arrears of Widow's Pension

Mrs. B. was widowed in 1988 but did not claim a Contributory Widow's Pension until March 1994. She was entitled to the pension and it was paid with the award of six months arrears. She was aggrieved at the Department's decision to leave her pension entitlement for the previous five years unpaid. According to Mrs. B., the reason she did not claim before 1994 was that she had twice been assured by her late husband's accountants that she did not have any entitlement to a widow's pension. She felt it was unreasonable and inequitable that she should lose such a substantial entitlement. The Department's general approach to this type of situation has been to say that it cannot be held liable for any mis-advice from a professional adviser or, indeed, from any third party. This remains the Department's position - see opposite. The Ombudsman's approach was to suggest that payment of the arrears did not amount to any acceptance of liability on the part of the Department; rather, payment should be seen as an equitable decision not to impose a penalty where the claimant had acted entirely reasonably. The Department was not prepared to pay Mrs. B. on the basis proposed above. However, it established that in January 1989 Mrs. B. had applied to the Department for a Death Grant in respect of her late husband. The Department decided that this 1989 application could be treated as amounting to a widow's pension application and that pension arrears could be paid from six months prior to that date. On this basis pension arrears of approximately �36,000 were paid to Mrs. B. This approach by the Department displayed a commendably liberal interpretation of the approach - which emerged from the Ombudsman's 1997 investigation - whereby receipt of one payment can be taken as satisfying the requirement to have claimed another higher- rate payment. The Ombudsman had already suggested such an approach to the Department some months earlier in a similar case and the Department had accepted it. In Mrs. B.'s case, the Department took this approach on its own initiative.

Nineteen Years' Arrears Paid

Mrs. C's husband died in 1971 leaving her with three children to look after. She would have been entitled to Contributory Widow's Pension but she did not claim it at that time. In fact not until 21 years later, in 1992, did Mrs. C. discover, through a chance conversation with a friend, that she probably did have entitlement to a pension. She applied and was paid with six months arrears. Subsequently, she explained to the Department that she had not claimed in 1971 because of information given by an official of the Department which led her to believe she had no such entitlement. In fact, according to Mrs. C., her late husband's employer had on her behalf, and in her presence, telephoned the Department in 1971 to ascertain whether she might have a widow's pension entitlement. Mrs. C. is clear that the employer was told by the official that she would not be entitled. However, by the time she did claim, her late husband's employer had died and Mrs. C. could not name the official involved. The Department was unwilling to accept that arrears should be paid. In 1996 Mrs. C. complained to the Ombudsman. The Department took the view that there was no evidence to support Mrs. C.'s contention regarding the advice given in 1971. In December 1998 Mrs. C. was paid �4,792 under the Budget Initiative (described in Chapter 2) but this amounted to only 15% of the arrears lost. Not surprisingly, she remained very aggrieved at this loss. The Ombudsman's Office suggested that Mrs. C. should consider swearing an affidavit in which she would set out her recollection of the contact her late husband's employer had with the Department in 1971. Mrs. C. did so. On the basis of this affidavit, and following an interview with her, the Department decided in March 1999 that all outstanding arrears should be paid. These arrears covered more than 19 years and amounted to more than �28,000.

Disability Claim treated as Claim for Widow's Pension

Mrs. D. was widowed in 1980 but did not claim Contributory Widow's Pension, to which she was entitled, until 1992. Initially, she was paid just three months arrears but was paid a further three months in 1997 at the time when she complained to the Ombudsman. She contended that she had been in a state of clinical depression, and receiving psychiatric care, for years following her husband's death and had not been able to manage her affairs as a result. She supplied medical evidence to support these contentions. However, the Department took the view that the medical evidence was not sufficiently strong to sustain the contentions particularly given that Mrs. D. took up employment after her husband's death.

In the course of considering the case, the Department noted that Mrs. D. had made a claim for Disability Benefit in February 1987. The Department then decided that this 1987 claim could be taken as counting as a claim for Contributory Widow's Pension and that arrears of that pension could be paid from six months prior to this claim date. On this basis, arrears of �13,000 were paid to Mrs. D. The Department's decision, to treat the 1987 Disability Benefit claim as amounting to a Contributory Widow's Pension claim, displayed a commendable degree of flexibility on its part. However, arrears for the period 1980 -1985 remained unpaid and the Ombudsman has not concluded his consideration of this aspect of the case.

Invalidity Pension - Late Claim Penalty

In February 1998, prior to the making of the current regulation dealing with the improved arrears arrangements for widow's and old age pensions, the Ombudsman's Office suggested to the Department that Invalidity Pension might well be included in whatever new provisions were to be introduced. The Department took the view that there was no evidence to suggest that there was a need to include Invalidity Pension in the new arrangements and that, in any event, to include it could be problematic. This was a reference to potential problems in retrospectively proving incapacity where the Department would not have the opportunity of conducting its own contemporaneous medical examination. However, a specific case did arise which required a flexible approach to Invalidity Pension arrears. Mr. K. had to take early retirement from work in July 1993 because of illness. In fact he had Alzheimer's Disease. In his particular circumstances, Mr. K. would have been entitled to either Disability Benefit or Invalidity Pension at the stage of leaving work. Not surprisingly, he made no such claim. In May 1994 his wife made enquiries and discovered that her husband could have been receiving a social welfare payment since the previous July. She applied on his behalf for Disability Benefit, which was paid with six months arrears back to November 1993. But the Department refused to pay arrears beyond the six months on the basis that the relevant regulation precluded this - irrespective of the reason why the claim was late. In November 1994 Mr. K. was transferred to Invalidity Pension which is payable at a slightly higher rate. In 1997 Mr. K's wife complained to the Ombudsman about the Department's refusal to pay the outstanding arrears for the period July - November 1993. Ultimately, the Ombudsman decided to investigate this case. But while the investigation was still underway, the Department decided (a) that Mr. K. should have been awarded Invalidity Pension rather than Disability Benefit when his claim was first decided and (b) that, under an existing extra-statutory arrangement with the Department of Finance, it would be possible to pay the outstanding arrears (amounting to �1,435) sought by Mr. K's wife. In addition, the Department indicated that it would move to include payment of Invalidity Pension arrears within a new regulatory framework. It is to the credit of the Department that it invoked the extra -statutory arrangement to benefit Mr. K. But the fact that such a discretionary arrangement was in existence, unknown to the public, to welfare rights workers and indeed to the Ombudsman's Office, is worrying.

"Lack of knowledge by itself is not regarded as a sufficient reason for not claiming in time. The Department publishes information leaflets as widely as possible and advertises changes of legislation in the National Press. .. The receipt of incorrect advice or information from any person other than a person employed by the Department of Social Community and Family Affairs is not regarded as a legitimate basis for a late claim or a consequent backdate." Department's Information Manual (as required under Freedom of Information Act)

"...an insurance or contributory social welfare scheme means that the cost of providing against a risk is spread as widely as possible over the group within which the risk is anticipated...There is also the important aspect of a contributory scheme that the payment of the necessary premium confers a title to benefit whether the beneficiary happens to be in economic distress or not at the time..." First Report of the Department of Social Welfare, 1947 - 1949

Case No. 12

"Because I did not know of my entitlements, and was not informed about them at that time, it seems unjust that I cannot now get some compensation for the fourteen years during which I did not get any social welfare pension." Letter of March 1987 to the Ombudsman - the writer (now deceased) was widowed in 1969 but did not claim Contributory Widow's Pension until 1983

One measure of an Ombudsman's effectiveness is the extent to which he or she can help focus public and parliamentary attention on underlying problems within, and recurring grievances against, the public administration. The Ombudsman's raw material is provided by complainants; but it would be an opportunity lost if an effort were not made to process this raw material in the interests of promoting better practice. It is within this context that the analysis of issues, which follows, is made. It would be foolhardy for an Ombudsman to act as if he or she had a monopoly of insight into public administration. For one thing the Ombudsman, almost by definition, does not see all those instances - undoubtedly the vast majority - in which the public has a good experience at the hands of public bodies. At the same time, the Ombudsman's view of public administration is fairly unique with access not only to the viewpoint of disgruntled customers but access also to the public officials concerned as well as to their complete files.

Arrears Penalty Based on Regulation

There is more than a reasonable possibility that the regulations which, up until 1997, formed the basis of the Department's practice in relation to late pension claims, would have been struck down had they been challenged in the High Court. But because these regulations were never challenged, we shall never know now what attitude the Court would have taken. It is not for an Ombudsman to decide that a particular regulation is invalid; but he is entitled to take a view on the matter and to be guided by that view in dealing with individual complaints. One category of maladministration listed in the Ombudsman Act, 1980 is that of action "taken without proper authority". The key question in considering the validity of a regulation is whether it achieves what the primary legislation intended. Primary legislation, in turn, is subject to compatibility with the provisions of the Constitution. In the present context, the following questions are pertinent. Was it the intention of the primary legislation:

  • that a person with a psychiatric condition or with Alzheimer's Disease, and whose pension claim was delayed on that account, should be severely penalised in terms of lost pensions arrears?
  • that a person who, acting in good faith, failed to claim a pension on time because of bad advice (whether from a professional adviser or otherwise) should be severely penalised?
  • that a widow or widower, seriously upset following the loss of a spouse, and perhaps heavily burdened with family responsibilities, should be severely penalised because of a delay in claiming widow's pension?
  • that a person, simply confused as to his or her real age, and who was late in claiming pension on that account, should be severely penalised?
  • that a person, whose failure to claim on time arose from nothing other than ignorance of the social welfare system, should be severely penalised?


On consideration, it does seem unlikely that the Oireachtas intended that severe penalties should be imposed in such cases. It is more likely the Oireachtas intended that measures would be put in place to protect the integrity of the overall Social Insurance Fund and facilitate its effective management. These measures, in turn, would not be out of proportion with what was needed for these purposes. The Ombudsman's Investigation Report of 1997 contained a detailed analysis of the legal framework within which "late claims" decisions were made. It is not necessary here to re-produce that analysis. However, the main points of relevance are as follows:

  1. Section 205 of the Social Welfare (Consolidation) Act, 1993 does require that a claim be made in the "prescribed manner" and it is for the Minister to prescribe the manner of claim i.e. on the standard claim form.
  2. Where a claim for "benefit" is made outside of the "prescribed time", the Minister may by regulation provide for disqualifying such a claimant "for the receipt of any benefit"; but such a regulation may also provide for the extending of the time within which such claim must be made.
  3. The option above appears not to provide for a limited disqualification e.g. disqualification for a limited period such as the period prior to the actual date of claim or part thereof; the provisions at 1. and 2. above relate to "benefit" which is a much wider category than "pension" and includes a number of short-term payments (e.g. Unemployment Benefit) where the Oireachtas may well have intended that a late claimant would be disqualified from receiving any benefit.
  4. The Act does not require the Minister, by regulation, to impose any penalty on a late pension claimant; and there is nothing to indicate that a harsh penalty should be imposed.
  5. In the light of 3. above, where the option is to disqualify or not to disqualify, it is arguable that the Oireachtas did not intend any penalty to apply to late contributory pension claimants provided the claim, when made, is in "the prescribed manner".

In any event, there is the underlying requirement that all rule-making bodies exercise their functions "with basic fairness, reasonableness and good faith". It would be difficult to argue that these regulations, in the light of the type of decision highlighted in this report, comply with these criteria. And, indeed, anyone who might have considered challenging these regulations in court might well have made other arguments e.g. that the regulations, in their consequences, amounted to an "unjust attack" on property rights and were, accordingly, at variance with Article 40.3.2 of the Constitution.


The current provisions governing the payment of arrears, where a contributory pension claim is made late, are described at Chapter 2 above. Set out below are some comments on these provisions from a legal perspective. The central feature of the current arrangement is an amendment to Section 205 of the Social Welfare (Consolidation) Act, 1993 (effected by Section 32 of the Social Welfare Act, 1997). This retains the requirement that a claim must be made in "the prescribed manner" but it radically alters the provision - described at 2. above - whereby a person may be disqualified "for the receipt of any benefit" in the event of a late claim. The current provision here is that "[w]here a person fails to make a claim for benefit... within the prescribed time, he or she shall be disqualified for payment" for a specified period which varies with the particular payment. In the case of old age and widow's pensions (contributory), the disqualification is in respect of any period more than 12 months before the date on which the claim is made.

Having established, in the case of old age and widow's pensions (contributory), that disqualification for payment applies in relation to any period more than 12 months prior to the actual date of claim, the Act (as amended) goes on to provide that this arrears period may "...subject to such conditions and in such circumstances as may be prescribed [by the Minister], be extended by a deciding officer or an appeals officer, as the case may be." Section 205(2D) of the Social Welfare (Consolidation) Act, 1993 (as inserted by Section 32 of the Social Welfare Act, 1997)

In effect, this enables the Minister to make regulations to extend the arrears payable beyond the 12 months already specifically provided. As outlined at Chapter Two, the Minister has made such regulations and they do provide for (a) the payment of a proportion of other arrears (beyond 12 months) and (b) discretion to pay even more arrears in certain circumstances. There are some difficulties with the present legal provisions, welcome as they may be. For example, there is no discernible guidance within the Act as to how the Minister is meant to exercise the powers, delegated to him in the new Section 205(2D), to extend arrears beyond the guaranteed 12 month period. As matters stand, the Minister might have chosen to extend the arrears period by a further four weeks or he might even have chosen to pay full arrears in all cases. The Act appears not to establish any principles or policies which the Minister would put into effect and the Minister would appear to have an unfettered discretion. However in the context of Irish administrative law, no exercise of discretion (except perhaps by the President) is completely unfettered because, ultimately, it must satisfy Constitutional standards of reasonableness and fairness.

However, there appears to be an even more fundamental problem with the current provisions. In its response to a draft of the Ombudsman's Investigation Report of March 1997, the Department referred to the problem, identified in the then draft report, whereby the penalties being imposed on late pension claimants were contained in secondary, rather than primary, legislation. The Department said that it was now proposed to put these provisions into primary legislation by means of Section 32 of the Social Welfare Act, 1997. Section 32 certainly links the imposition of a penalty to a failure to claim within the "prescribed time"; but it is the Minister, and not the Oireachtas, who defines the "prescribed time". The Act is silent on what should constitute the "prescribed time"; it appears not to offer any guidance, by way of policy or principle, on how the Minister should define that term. What this means in practice is that it is the Minister, by regulation, who decides when the penalty system should kick in. In real terms, it would seem that Section 32 has done very little to cure the perceived defect whereby the imposition of significant penalties has become a matter for the Minister, by regulation, rather than a matter for primary legislation. [Whether the Ombudsman would ever be required to consider the consequences of actions taken on foot of these regulations remains to be seen. So far, this issue has not been directly raised through complaints received.] The overall difficulty is compounded by the absence of any effective monitoring or control of secondary legislation within the Oireachtas. This is an issue discussed immediately below.

The Problem of Secondary Legislation

This is not the place to undertake a detailed critique of the complex issues raised by secondary, or delegated, legislation. At the heart of any such critique is the issue of achieving balance between the powers of the Executive and those of the Oireachtas. Ultimately, a mechanism is needed which acknowledges the utility of secondary legislation - in terms of the flexibility it provides for voluminous and often complex regulations - while enabling the Oireachtas to supervise effectively the exercise of the powers which it has delegated.

The experience of the Ombudsman's Office suggests that there are serious questions to be raised on this issue. Central to the Ombudsman's concern is that penalties or burdens should only be imposed by regulation where it is clear that the Oireachtas intends that this should be the case. Another issue is that where primary law is to be made operational by way of secondary law, there should not be any unauthorised restriction on the putting into effect of the primary law. The Ombudsman has already adverted to this issue on a number of occasions. For example, in an address to the Institute of Public Administration's National Conference in November 1997, the Ombudsman observed: "...I have found that restrictions or qualifications, not specifically provided for in the primary legislation, are often incorporated into statutory regulations which as we all know receive very little scrutiny... I detect an attitude which sees delegated legislation as a means of fine tuning in areas which might prove controversial if included in the primary legislation."

The Ombudsman gave two examples; the first related to the "late claims" regulations, the subject of this present report, while the second involved regulations governing the payment of subventions to patients in private nursing homes. These regulations (SI No. 227 of 1993) were made by the Minister for Health under the Health (Nursing Homes) Act, 1990. What was remarkable about them was that, in determining what subvention (if any) was payable to the patient, regard was had to the capacity of any adult children to contribute to the nursing home costs. At least this was the manner in which the health boards chose to interpret the regulations. In effect, the regulations were being operated as if adult children had an obligation to contribute to the parent's nursing home costs. The Ombudsman made the point that children do not have a statutory obligation to support their parents; that there is nothing in the Health (Nursing Homes) Act which could be construed as creating such an obligation; and that the regulations, at least in so far as they were having the consequences just described, appeared to be without Oireachtas authority. Whether or not adult children should have an obligation to support their elderly parents is an open question; but a decision on it is surely one for the Oireachtas and not for an individual Minister. These regulations were recently amended and, with effect from 1 January 1999, the provisions in question have been deleted. However, for more than five years the regulations operated as described despite their probable invalidity. The issue of nursing home subventions will be the subject of a separate report from the Ombudsman later this year. In his Annual Report for 1994 the Ombudsman drew attention to a perceived defect in the 1993 regulations which implemented the EU Directive on freedom of access to information on the environment. The regulations excluded from their scope information which is already covered by some other statutory provision e.g. planning records. The Ombudsman pointed out that the Directive contained no such provision and that it was a matter for concern that the regulations should be more restrictive than the Directive itself. The Department of the Environment subsequently amended the regulations and dealt with that particular difficulty.

More important than the individual social welfare, nursing home or information on the environment regulation is the fact that the Oireachtas appears to have no effective mechanism for scrutinising secondary legislation to ensure that what is being done under its authority, actually conforms with its intentions. One approach would be to make it easier for individual Oireachtas members to be allocated time, whether in Committee or otherwise, in which to raise issues or concerns in relation to individual regulations. An alternative approach would be to establish an Oireachtas Committee with a brief to monitor secondary legislation and to report to the two Houses (providing of course that a mechanism would exist to allow the reports of such a Committee to be considered by the Dáil and Seanad). In its Second Progress Report, of April 1997, the All-Party Oireachtas Committee on the Constitution suggested that the Seanad could provide the forum in which a check could be kept on statutory instruments. Whatever the precise mechanism, it seems clear that there is a real need for the Oireachtas to supervise the exercise of those powers which it delegates to rule making bodies

Discretion and Extra-Statutory Arrangements

The exercise of discretion and the application of extra-statutory arrangements are two related issues which arose in relation to the "late claims" complaints. They raise questions of major complexity and it is beyond the brief of this report to attempt a detailed analysis. Two specific, but related, points arise. The first relates to the manner and the context in which discretion is exercised; the second relates to the need for openness in relation to the existence of discretionary powers.


In the present context, the term "discretion" implies the capacity to choose or distinguish between a number of options. Discretion can be conferred within a statutory framework or can arise in administrative, or extra-statutory, arrangements or schemes. Sometimes a statutory provision is so non-specific that an exercise of judgement or discretion is required to give it effect. The exercise of such discretion must, as already stated, conform to Constitutional standards of reasonableness and fairness. Accordingly, it seems desirable that, to the greatest extent possible, discretion should be exercised within a set of rules or policies which provide guidance to the decision maker and minimise the risk of arbitrary decisions. Provided, of course, that any such rules or policies do not have the effect of actually restricting the scope of the discretion given. Unfortunately, such rules or policies are frequently not part of the context in which such decisions are taken. Where such rules or policies have not been supplied by the Oireachtas or by the organisation itself, it seems sensible that decision makers should seek to infer or deduce them. As the Ombudsman noted in his Annual Report for 1998, in the context of the School Transport Scheme, where exceptions to the general rule are proposed these exceptions should, as far as possible, be made on objective and impartial criteria. For example, one of the questions raised in the 1997 Investigation Report was that of the form in which a claim to pension should be made. The wording in the relevant regulation was that a claim must be made "in the form for the time being approved by the Minister or in such other manner as the Minister may accept as sufficient in the circumstances" (our emphasis). The Ombudsman's Office had several times suggested to the Department that the discretion inherent in this wording should be utilised to the advantage of late pension claimants. Specifically, where the pensioner had claimed or was receiving a related payment (but at a lower rate) during the "arrears" period, it seemed to the Ombudsman that there was sufficient flexibility in the regulation to allow the claim for the other payment to be regarded as "sufficient in the circumstances" to count as a claim for the higher rate pension. In the Investigation Report (at Para. 68), the Ombudsman outlined a series of considerations which supported the exercising of discretion in favour of the pensioner. These included the very nature of social insurance, the absence of clear information on the penalties for late claims, and a presumption some pensioners would have that the Department would always advise them of the best payment option for them. Ultimately, the Department did accept that the regulation could and should be applied in this manner. It would, however, have been preferable if the Department had itself developed such a policy on its own initiative. Another example of failure to use an available discretion arose in the context of the arrangements for the extra-statutory payment of lost arrears of pension (see Chapter 2). One of the grounds for payment agreed between the Department and the Department of Finance was "in any other circumstances in which the Minister for Social Welfare is satisfied that payment should be made in equity ..". Clearly, there was an attempt in this arrangement to link the discretion to agreed criteria. Unfortunately, and as suggested in the Investigation Report, it appears the Department chose to take an unduly restrictive view on what constitutes equity. On the basis of instances in which it has invoked equity, it seems that its use was largely confined to cases in which the failure to claim arose because of the Department's own mistake or where the pensioner failed to claim because of medical incapacity. Equity constitutes a very wide category but, in essence, it has to do with ensuring justice even if at the expense of the letter of the law. As the Ombudsman's own Guide to Standards of Best Practice for Public Servants puts it, dealing "fairly" with people means "accepting that rules and regulations ... should not be applied so rigidly or inflexibly as to create inequity". The Guide also holds that fair dealing requires the avoidance of "penalties which are out of proportion to what is necessary to ensure compliance with the rules".

In summary, it seems to the Ombudsman that where a discretion is available (a) it should be exercised in accordance with clear rules or policies and (b) where these rules or policies provide a number of options, no option should be excluded in an arbitrary way.


A disquieting feature reported on in the 1997 Investigation Report was the fact that the Department's extra-statutory discretion to pay pension arrears, as agreed with the Department of Finance, was effectively kept secret. The arrangement dated back to 1961 in the case of the old age pension and even earlier in the case of widow's pension. Certainly, the arrangements were agreed at a time when a culture of secrecy prevailed; but they continued to exist, unpublicised, long after the Department had adopted a customer-focused approach to its claimants. It would seem that these arrangements amounted to a supplementary set of rules which could be invoked, or not invoked, at the discretion of the Department. Because pensioners, and the public generally, were unaware of the existence or details of these rules, it was not possible to seek to rely upon them. In effect, the Department retained to itself the powers to decide that these rules should be invoked. It would be unfair to suggest that the Department ever actively abused these powers. Indeed, the arrangements only came to the Ombudsman's attention because the Department chose to use them in a particular case. Nevertheless, it is clear that many pensioners could have made very strong arguments for arrears payments had they been aware of the arrangements. One such instance is Case No. 3 at Chapter 2 in this report, but there were very many more. At best, it would be fair to say that it was a matter of chance as to whether the Department would choose to use the extra-statutory discretion. The pensioner would need to have persisted in seeking arrears and would need to have been lucky enough to present a reason for the late claim which co-incided with the grounds covered in the arrangement (e.g. delay was due to ill health or to mis-advice by the Department). Because pensioners did not know that these might constitute grounds for payment of arrears, there was no good reason why they should mention them to the Department. In its Fifth Report (October 1985), the Commission on Taxation dealt with the discretion available to the Revenue Commissioners in the form of extra-statutory tax concessions. The Commission expressed views then which are very similar to those set out above, commenting:

"The way certain legislation is interpreted in a given situation may amount in practice to an extra-statutory concession. It should follow that the Revenue Commissioners apply the same interpretation in all similar situations, in which case there can be no objection to its being published. ...This is the only defence against administration which may become arbitrary and against suspicion which may be unfounded."

The Freedom of Information Act, 1997 should do much to displace any lingering tendencies to secrecy within Irish public bodies. Section 16 of that Act specifically requires public bodies to publish, for the benefit of the public, full details of the rules, procedures, guidelines and precedents which govern the conduct of their business. Within this requirement, the possibility of a public body keeping secret any of its rules or discretions should, in future, be remote. In summary, the point about openness in relation to discretion is that (a) it enables those who might stand to benefit to be aware of its existence and (b), perhaps more importantly, openness is a very effective brake on any tendency to the arbitrary or idiosyncratic application of discretion. As Kenneth C. Davis has put it (see opposite): "Openness is the natural enemy of arbitrariness and a natural ally in the fight against injustice".

Social Insurance - Is it Different?

In reviewing what complainants have said over the years about lost contributory pension arrears, it is striking that so many of them see social insurance as somehow different from the general run of income maintenance payments. Many of them are very clear that social insurance payments are made from a fund created by their own contributions, and those of their employers, and they feel they have both a moral and a legal right to these payments, irrespective of any technical nfringements (such as being late with a claim). Complainants do not advert to the fact that the Exchequer generally contributes to the social insurance fund on a top-up basis, that is, meeting whatever shortfall may arise between outgoings and contributions received from employers and employees. However, the trend with the Exchequer contribution over the past 35 years has been one of gradual decline, with a matching increase in the proportion contributed by employers. In 1994 the Exchequer contribution had dropped to 2.4% of the total fund and in the past two years no Exchequer contribution has been necessary. The employee contribution, as a proportion of the overall fund, has held reasonably steady over the past 35 years at roughly 25 per cent. The Department makes the point that comparison of social insurance with other forms of insurance may be misleading. The Department's views on this are set out in detail in the 1997 Report. The Department's principal points are:

  • social insurance payments are not risk rated;
  • benefits are not directly linked to the level of contribution made;
  • payments are financed on a pay-as-you-go basis rather than on an invested fund basis.

The future funding of social insurance is certainly likely to be problematic given the enormous growth in contributory pension costs anticipated over the next few decades. For example, the number of persons over 65 years is projected to grow from 11% of the population in 1996 to 27% of the population in 2056. The Old Age Dependency Ratio is estimated to decline from 5.1 in 2006 to 1.9 in 2056. Clearly a review of the system, including the contributions of all the parties, will be needed to meet the expected demands on the fund. While the scale of future demands on the fund is substantial, it does put in context the relatively insignificant demand represented by the unpaid arrears being claimed in the "late claims" cases. The Department's role in relation to social insurance is one of manager of the fund on behalf of the fund contributors and beneficiaries. On the one hand, it will be anxious to ensure that outgoings are contained in a way which minimises any need to increase contributions. In particular, the Department is conscious of the desirability of limiting any Exchequer exposure. On the other hand, the Department acts in a trustee capacity in relation to the beneficiaries. The inference in what complainants have been saying to the Ombudsman is that the Department is striking the wrong balance between these potentially conflicting roles. There is a danger that, where the Department is responsible both for social nsurance payments and for the parallel means-tested income maintenance system, it may be unduly influenced by its responsibilities in relation to the latter. Clearly, the Department has the administrative machinery to deliver both social insurance and means-tested payments and there are economies of scale arising. But is there a case for suggesting that, in the context of the changes which are inevitable in the social insurance system, the Department should consider whether the Fund might be managed in future with the benefit of advice from some kind of advisory body which represents the interests of all the parties to the Fund viz. insured workers, employers and the Exchequer?

Why No Earlier Action?

The final issue arising is why the Department took no effective action between 1985 and 1997 to mitigate the adverse consequences for late pension claimants. One of the advantages of an Ombudsman system is that general complaint issues can be identified and highlighted thus enabling the public body in question to address that issue in its totality. In conducting the investigation, the report of which was published in 1997, the Ombudsman found no evidence to suggest that the Department had undertaken any serious review of the "late claims" issue between 1985 and 1996. This was despite the detailed comments from the Ombudsman in Annual Reports from 1985 onwards - see Chapter 4. The Department's justification for maintaining its penalty system was based on the need to have proper supervision and control of payments, the need for sound financial management and "for public expenditure purposes". The Ombudsman has always acknowledged that these concerns are genuine; and, since individuals must take some responsibility for their own actions or inactions, that there should be some penalty for people who might be careless in taking up a social insurance entitlement. However, the Ombudsman's overall response is twofold:

  • the penalty imposed - at least until 1997 - was seriously out of proportion to the detriment which might be created by a late claim;
  • the primary reason for claims being late, generally, has had to do with the complexity of the social welfare system, the confusion in many people's minds about the system, and the difficulty in the past in accessing reliable information about welfare entitlements.

Furthermore, in relation to old age and widow's pensions, the control considerations created by a late claim are relatively minor (as opposed to the situation in the case of late claims for unemployment or sickness payments). The issue of proper financial management of the fund was far from being insuperable (the Ombudsman has some observations on this in the 1997 Report). In fairness to the Department, the overall welfare system was under pressure from the mid 1980s onwards and it may have taken the view that it had far more pressing priorities than the payment of pension arrears. This may be understandable but it is hardly acceptable in terms of basic fairness and of good practice. If there is one lesson to be learnt from this entire episode, it is that public bodies should directly, openly and speedily address those problem areas drawn to attention by their clients' complaints.

Some Conclusions

The Ombudsman intends this report to mark the end of his Office's involvement with the general issue of lost arrears of contributory pension. Some individual complaints remain to be finalised, and some new complaints on the issue may yet be received but, in terms of looking at the general issues arising, this report represents a conclusion. The actual conclusions, some of which are summarised below, should be relevant across the full range of public administration in Ireland. Perhaps the first conclusion is that the penalty system was excessively harsh and inequitable and this harshness and inequity was allowed continue for far too long. The reforms introduced in 1997 might have been introduced at any point after the issue was first raised in 1985. The reforms were introduced in response to the Ombudsman's 1997 Report; but there was nothing in that report of which the Department had not been aware for many years. The inherent inequity of the system should have been enough to prompt change. But it seems that change would have to wait until the Department was forced to act in the face of sustained criticism from the Ombudsman. Of course the Department did not have a free hand in all of this. It needed the approval of the Department of Finance to the relaxation of the penalty as any change in arrangements would have spending implications. In the context of the annual budgetary negotiations between the two Departments, it would seem that there were always other developments whose funding should take priority. The fact that the affected pensioners have never been organised as a lobby group must have adversely affected their case. A related question, for the Ombudsman's Office itself, is whether it could have been more proactive in pursuing the issue at an earlier stage. The Office was initially reluctant to investigate a policy and practice which was firmly rooted in secondary legislation. The Office did have a view that it could do no more than express criticism of the policy and its unfair consequences. It was some time before the issue of investigating individual "late claims" complaints, and confronting the regulation on which the penalty was based, emerged as a real option. As mentioned in Chapter 4, the Office engaged in the normal process of re-appraising its approach to investigation and from this process some new thinking evolved in relation to the understanding of "adverse effect" and "maladministration". This re-appraisal included taking account of the Council of Europe's Principles of Administrative Law Concerning the Relations Between Administrative Authorities and Private Persons. These principles, while congruent with the categories of maladministration set out at Section 4(2) of the Ombudsman Act, do amplify our understanding of those categories. These Council of Europe principles contributed significantly to the Ombudsman's own Guide to Standards of Best Practice for Public Servants (published with the 1996 Annual Report) which, in addition to the principle of proportionality, stressed the need to avoid the application of rules in an inflexible manner where to do so creates an inequity . These were two of the key principles which informed the Ombudsman's investigation of the "late claims" cases. While it would have been better from the complainants' perspective if the Ombudsman had taken this step somewhat earlier, it is probably the case that the outcome ultimately achieved depended upon the development in thinking just outlined. From the perspective of the Dáil and Seanad, perhaps the conclusion of most direct relevance is that relating to the supervision of secondary legislation. This issue is inextricably bound up with the balance of power as between parliament and the executive

The Ombudsman's conclusion here is that, whereas secondary legislation remains a necessity, there is a real need for a mechanism which enables parliament to satisfy itself that secondary legislation does not amount to a usurpation of any of those powers which belong to parliament alone. Interestingly, this very point was raised by the Supreme Court in a recent judgement - see opposite. Like any discussion in the area of administrative law, this report has relied heavily on technical terminology e.g. proportionality, discretion, equity, force majeure, fair procedure, adverse effect. By linking the discussion to the points of view of the people affected, as set out in the page margins, the Ombudsman hopes that the real significance of this rather dry terminology will have been made abundantly clear.

"The increasing recourse to delegated legislation throughout this century in this and the neighbouring jurisdictions has given rise to an understandable concern that parliamentary democracy is beingstealthily subverted and crucial decision-making powers vested in un-elected officials." Keane J in Sorin Laurentiu and the Minister for Justice, Equality and Law Reform (Supreme Court, 1999)