NHS Business Services Authority v Ingram [2009] EWHC 2486 (Ch)

[2009] EWHC 2486 (Ch)Case No CH/2009/APP/0273
IN THE HIGH COURT OF JUSTICE
CHANCERY DIVISION
ON APPEAL FROM THE PENSIONS OMBUDSMAN
(SECTION 151(4) OF THE PENSIONS SCHEMES ACT 1993)
Venue Royal Courts of Justice, Strand, London, WC2A 2LLDate 12/10/2009
Before
MR JUSTICE WARREN
Between
NHS BUSINESS SERVICES AUTHORITYAppellantEDWARD INGRAMRespondent
Ms Sarah Moore (instructed by DWP /DH Legal Services) for AppellantThe Respondent Mr E Ingram did not attendHearing Hearing dates: 8th October 2009
Judgment

Introduction

[1]This is an appeal from a decision of the Pensions Ombudsman (“the PO”) dated 30 April 2009 in which he upheld the complaint of the respondent to this appeal, Mr Edward Ingram, against the appellant, NHS Business Services Authority (“NHSBSA”), concerning the level of a benefit known as Permanent Injury Benefit (“PIB”) to which he is entitled. The issue arising on this appeal concerns the interaction of PIB with another benefit known as Industrial Disablement Benefit (“IDB”). Ms Sarah Moore appears for NHSBSA. Neither Mr Ingram nor the PO appears nor have they made any written submissions.[2]NHSBSA is a Special Health Authority established by the Secretary of State for Health under the NHS Business Services Authority Order 2005 SI 2005/2414, pursuant to section 28 of the NHS Act 2006, to exercise several of his functions relating to the health services. Among other things, it exercises the Secretary of State’s function of administering the NHS pension, injury benefits and compensation schemes. One of those schemes is the scheme set out in the National Health Service (Injury Benefits) Regulations 1995 (“the Regulations”). In summary, this scheme provides an annual allowance for persons who cease to be employed because of injury sustained or disease contracted in the course of NHS employment. The level of the annual allowance is a percentage of the individual’s average salary over a relevant period. In the most serious cases, an individual is entitled to a maximum annual allowance of 85% of his average salary (adjusted for inflation each year) for the rest of his life. One purpose of the scheme is to provide an annual income on a no fault basis to an employee who suffers a permanent loss of earnings ability, resulting from an injury or disease wholly or mainly attributable to the duties of their NHS employment. PIB is paid to the individual if that individual’s income, made up of the pensions and benefits specified in regulation 4(6), is less than the annual allowance as described in regulation 4(2), so that the individual’s total income, including PIB, reaches the designated amount.[3]As its name suggest, IDB is another scheme providing benefits to employees who suffer injury in the course of their employment. It is a scheme which is applicable generally and is not restricted to NHS employees. Entitlement to benefit arises under section 103 Social Security Contributions and Benefits Act 1992 (“SSCBA 92”). The level of benefit (which is laid down in section 103(7) and part V Schedule 4) is dependant upon the degree of disablement suffered by the claimant. IDB is assessed and paid by the Benefits Agency (the “BA”), part of the Department for Work and Pensions. The assessment is therefore nothing to do with NHSBSA.

The Regulations in more detail

[4]By regulation 3(2), the Regulations apply, subject to a number of conditions, to “an injury which is sustained and to a disease which is contracted in the course of the person’s employment…..”[5]Regulation 4 is headed “Scale of benefits” and provides in regulation 4(1) for a benefit to be paid to any person within regulation 3(1) whose earning ability is permanently reduced by more than 10% by reason of the injury or disease. Regulation 4(2) provides as follows:
“4(2) Where a person to whom regulation 3(1) applies ceases to be employed as such a person by reason of the injury or disease … there shall be payable, from the date of cessation of employment, an annual allowance of the amount, if any, which when added to the value, expressed as an annual amount, of any of the pensions and benefits specified in paragraph (6) will provide an income of the percentage of his average remuneration shown in whichever column of the table hereunder is appropriate to his service in relation to the degree by which his earning ability is reduced at that date.”
[6]There then follows a table setting out the percentage applicable depending on the degree of reduction of earning ability and the period of service.[7]In the present case, we are concerned with the benefits referred to in paragraph (6)(b) which opens with the following words:
“any of the following benefits, at the rates in operation at the date on which the employment ceased … which are payable to the person …”
[8]There then follows a list of various benefits in paragraphs numbered (i) to (vi). IDB is found referred to in these terms:
“(i) disablement pension or gratuity payable under section 103 of the Social Security Contributions and Benefits Act 1992 or so much of any such pension or gratuity as related to the injury or disease…..”
[9]Regulation 13 provides for a review and adjustment of an allowance payable under the provisions which I have set out above. The Secretary of State is given power to review the amount of an allowance in the light of a limited number of circumstances including:
“the commencement or cessation of a benefit mentioned in regulation 4(6)(b), by reason of the injury or disease”
.

The Facts

[10]The somewhat complex facts appear clearly from the Decision at paragraphs 3 – 11. Ms Moore has helpfully set out the facts in her skeleton argument and, with some slight changes and with some comments, I gratefully adopt what she has written.[11]Mr Ingram’s NHS employment ended on 14 January 2001. He was granted an ill health retirement pension under the National Health Service Pension Scheme Regulations 1995. He applied for PIB. He had also previously applied for IDB.[12]Mr Ingram’s claim for IDB was based on five accidents which took place between 1 January 1990 and 26 April 1999. At first the BA only permitted three of the accidents to be treated as industrial accidents and Mr Ingram was paid IDB on that basis. In this respect on 12 June 2001 the BA wrote to Mr Ingram stating that he would be paid IDB of £32.43 per week from 28 January 2000 to 11 April 2000, £32.79 a week from 12 April 2000 to 10 April 2001, and £33.87 a week from 11 April 2001 to 4 December 2001. Mr Ingram appealed against the BA’s decision not to treat the other two accidents as industrial accidents.[13]On 7 January 2002 the Pensions Agency (now NHSBSA) informed Mr Ingram that, in respect of his claim for PIB, the medical adviser for the purposes of the statutory PIB scheme had concluded that his earnings ability had been reduced by more than 25% and up to 50% because of his injury. Based on his earnings and service he was entitled to a guaranteed income of £9,016.73 pa from 15 January 2001. However, as Mr Ingram’s actual income, comprising his NHS pension and state benefits (including IDB which was stated to be £1,709.76 pa ) exceeded that sum, no PIB was in fact payable. Mr Ingram sought a review of this decision.[14]Before that review had been conducted by NHSBSA, a decision was made by the BA in relation to the IDB. In March 2002 the BA wrote to Mr Ingram accepting that the two accidents which they had originally rejected as industrial accidents were, after all, accepted as industrial accidents. The BA revised his IDB accordingly with retrospective effect. It was, I would add, clearly correct in back-dating the payments. Under the revisions, Mr Ingram was entitled, according to the BA, to £54.05 a week from 2 February 2000 to 11 April 2000, £54.65 a week from 12 April 2000 to 10 April 2001, and £56.45 a week from 11 April 2001 to 1 March 2003. There was no effect on Mr Ingram’s entitlement (or rather, lack of entitlement) to PIB since the increase in his IDB simply increased the amount by which his total income exceeded his annual allowance for the purposes of the Regulations.[15]On 19 August 2002 NHSBSA wrote to Mr Ingram about his PIB claim. He was informed that the scheme’s medical advisers had reviewed his loss of earning ability and revised it to between 51% and 75%. It is important to note that this was a re-assessment of the level of his impairment at the time when he left service on 14 January 2001, and not a reflection of a deteriorating state of health in the intervening period. Accordingly, Mr Ingram should have received a benefit based on the higher percentage from the date of leaving service. This was accepted by NHSBSA and meant that Mr Ingram was entitled to a guaranteed income of £12,623.42 pa with retrospective effect from 15 January 2001. Since Mr Ingram’s income was by this time, August 2002, £10,923.73 (including IDB of £2,849.61 or £54.65 per week)) he was informed that he was entitled to a PIB of £1,699.69.[16]The next event, in March 2003, was the discovery by the BA that it had made a clerical error in calculating Mr Ingram’s IDB. The IDB had been calculated on the basis that Mr Ingram had suffered a disablement of 50% whereas it should have been calculated at 40%. Curiously, the letter, dated 15 March 2002, which informed Mr Ingram of the level of his benefit had specified the figure of 40% but stated the actual amount of the benefit in £s based on 50%. Correction of this error meant that Mr Ingram’s entitlement to IDB at the date when his employment ceased should have been £2,279.69 pa (which is approximately £43.84 per week) rather than £2,849.61 pa. The BA accordingly reduced IDB from 5 March 2003, but did not (for what I can imagine were very sensible practical reasons) seek to recover the overpayments made before that date.[17]This reduction in Mr Ingram’s IDB was perceived by NHSBSA as having a knock-on effect on his PIB. Since the IDB went down, NHSBSA considered that PIB should be correspondingly increased so as to preserve Mr Ingram’s overall entitlement of £12,632.42.[18]On 24 November 2007 NHSBSA wrote to Mr Ingram about the outcome of a general review of his PIB and said that its application of regulation 13(1)(b) had been incorrect. The error was that the PIB had been recalculated (and increased) when Mr Ingram’s entitlement to IDB had changed (and decreased) in March 2003 whereas the PIB should only be reviewed when payment of such a benefit started or stopped rather than simply be increased or decreased. NHSBSA informed Mr Ingram that his PIB was accordingly reduced to the level that it considered correct, namely £1998.84 pa. This figure was based on an IDB of £54.65 per week, which, by virtue of the decision taken in March 2002, was the amount that Mr Ingram received (retrospectively) at the time his employment ceased. The PIB reduction was only applied prospectively; NHSBSA acknowledged that it had been in error and did not seek to recover what, on its analysis, was the previous overpayment of PIB.[19]Mr Ingram was unhappy about the reduction and complained under the scheme’s internal dispute resolution procedure. At stage 1, NHSBSA maintained that Mr Ingram’s PIB had been calculated correctly but at stage 2 it was decided that Mr Ingram’s PIB should be recalculated on the basis of the, lower, corrected, rate of IDB paid prospectively from 5 March 2003.[20]Mr Ingram remained dissatisfied and complained to the PO, arguing that his PIB should be calculated on the basis of the (yet lower) IDB rate determined in June 2001 (and paid retrospectively from 14 January 2001), a rate determined, it will be remembered, on the basis that only 3 of the 5 accidents were accepted as industrial accidents. NHSBSA did not seek to uphold the stage 2 determination but took a position against Mr Ingram contending that his PIB should be calculated on the basis of the IDB rate determined in March 2002 (and paid retrospectively from 14 January 2001).

The Decision

[21]The PO held that NHSBSA had been wrong to reduce Mr Ingram’s PIB in order to take account of the retrospective increase in his IDB in March 2002 and that his PIB should be assessed by reference to the rate of IDB assessed in June 2001, that is to say in accordance with the first assessment of the benefit to which Mr Ingram was entitled. He held that, regardless of whether the payment of IDB was initially incorrect because of a mistake, it was not open to NHSBSA to revise the amount of PIB to reflect the corrected level of IDB. In particular, he decided that the phrase “rate in operation at the date on which the employment ceased” for the purposes of regulation 4(6)(b) was a reference to the amount of IDB initially paid in respect of a particular payment period, even though later corrected with retrospective effect and replaced by a different rate.[22]The PO rejected the proposition that the phrase “rate in operation” meant the rate properly payable at the date when the employment ceased, noting that regulation 4(6) was not drafted using the words “applicable” or “appropriate” rate. He considered that the words “in operation” introduced “an element of actuality” and denoted the rate operating at a particular date, even if replaced by a new rate which was higher or lower than the original rate.[23]He concluded:
“In Mr Ingram’s case, the payment of £54.65 a week (later reduced when the BA’s error came to light) did not come into operation until March 2002 (following Mr Ingram’s successful appeals that the two other accidents should be treated as industrial accidents). Even though the new, higher, rate was backdated (which resulted in arrears being due) this does not to my mind negate the fact that, in relation to an earlier date, a different (lower) rate was operating, i.e. in operation. The upshot is that by the time Mr Ingram’s application for PIB was determined he had been granted IDB backdated to a date prior to 14 January 2001 (at the rates and for the periods as set out in the BA’s latter of 12 June 2001). In initially assessing Mr Ingram’s PIB in January 2002 NHSBSA took into account IDB of £1,709.76 I consider that was the correct figure under regulation4(6)(b) such that it was not open to NHSBSA later to substitute a different rate, notwithstanding that such rate was backdated.”

Submissions

[24]As I have said, neither Mr Ingram nor the PO appears on this appeal nor have they made any written submissions. I consider, nonetheless, that all the points which they could possibly wish to raise have either been raised by Ms Moore or by me. So far as Ms Moore’s own submissions are concerned, her position is that the phrase “rate in operation” can, and should, be read so as to mean the rate of benefit that was or has been paid in respect of the period when his employment ceased, even if that rate was determined retrospectively.[25]According to this submission, it is necessary to look at what has actually been paid, albeit retrospectively, in order to ascertain what “rate” has been “in operation”. Since the BA decided not to seek repayment from Mr Ingram of overpayments made to him, the relevant “rate in operation” is the rate at which he was in fact paid, £54.65 per week, even though that was an overpayment.[26]In support of that conclusion, she submits that the requirement to have regard to the rate of benefit “in operation at the date when employment ceased” correlates with regulation 13(1)(b) under which provision PIB is only reviewed if payment of a benefit falling within regulation 4(6) commences or ceases. If the rate of benefit merely changes (with prospective effect) there is no review of the PIB, it being assessed on the basis of the rate “in operation at the date when employment ceased”. This achieves a degree of certainty for the recipient as regards his level of PIB and prevents entitlement to PIB constantly fluctuating because of prospective changes made to the relevant benefit rates (such as statutory amendments to take account of inflation etc).[27]Ms Moore draws attention to this: in reaching a different conclusion the PO drew a distinction between the phrase “rate in operation” and a phrase such as “applicable rate” or “appropriate rate” which he reasons, had it been used in the legislation, would have given NHSBSA’s arguments more support NHSBSA agrees with the PO that the phrase “rate in operation” introduces “an element of actuality and denotes the rate operating at a particular date”, and that it cannot be interpreted as meaning the rate that should been have applicable (at the date the employment ceased) if it has not in fact been paid to the beneficiary. However, Ms Moore points out that the BA did not, in March 2002, merely determine what the correct rate of IDB should have been given as at 14 January 2001 but actually paid that corrected rate to Mr Ingram with effect from 14 January 2001. Accordingly it is submitted that the corrected rate was the rate that was actually operated in respect of that period. She adds that if the approach of the PO were taken to its logical conclusion so that Mr Ingram’s PIB was calculated by reference to the rate of IDB he was actually receiving as at the date his employment ceased, it would be assessed on the basis that he received no IDB (because his IDB did not commence until 12 June 2001, albeit with retrospective effect).[28]It is further submitted that it must be open to NHSBSA to revise an individual’s entitlement to PIB as a result of a change made (retrospectively) to the rate of IDB in operation at the date when employment ceased if the change is made in order to correct an administrative or clerical error. In those circumstances it would not be purporting to use regulation 13 incorrectly to review the level of PIB as a result of a prospective change to a benefit rate, but rather would be correcting the PIB to the level that was always properly payable. If it were otherwise, NHSBSA would be bound by clerical or arithmetical errors made with respect to the calculation of IDB when assessing PIB, even where those errors had been corrected for the purpose of assessing IDB itself.[29]In addition it is submitted that the Appellant’s approach accords with the purpose of the scheme, which is to act as an income protection scheme. By contrast, the approach of the PO has the effect that PIB may end up being payable at a level which protects the individual’s income beyond the maximum intended level of protection of 85%; (if, for example, an initial low IDB assessment resulted in a relatively high PIB but the IDB was subsequently reassessed with retrospective effect at a higher level the total income received by the individual might amount to more than 85% of his former salary). In any event it has the potential to create an arbitrary element to an individual’s entitlement to PIB, which has happened in the present case since Mr Ingram’s entitlement to PIB is now assessed by reference to a level of IDB (£32.79) which he did not receive.[30]Even if her primary submission is not correct, Ms Moore submits that the PO’s approach remains irredeemably wrong. She invites me to hold that Mr Ingram’s PIB should be calculated on the basis of an IDB equal to the reduced amount which became payable in March 2003 following the correction of the clerical error by the BA.

Discussion

[31]The issue before me is one of construction of the Regulations. The general principles underlying the process of interpretation are well-known and are set out by Lord Hoffmann in Investors’ Compensation Scheme v West Bromwich Building Society [1998] 1 WLR 896, 912-913. They are summarised by him in Chartbrook v Persimmon [2009] 3 WLR 267, at paragraph 14:
“There is no dispute that the principles on which a contract (or any other instrument) or utterance) should be interpreted are those summarised by the House of Lords in Investors’ Compensation Scheme v West Bromwich Building Society [1998] 1 WLR 896, 912-913….. It is agreed that the question is what a reasonable person having all the background knowledge which would have been available to the parties would have understood them to be using the language in the contract to mean".”
[32]This is the approach to be applied to construction of the Regulations as much as it is to a contract: see Lord Hoffmann, again, in A-G of Belize v Belize Telecom Ltd [2009] UKPC 10, [2009]2 All ER 1127 at paragraph 16 when discussing the related question of implication of terms. After setting out the Investors’ Compensation Scheme approach, he says this:
“It is this objective meaning which is conventionally called the intention of the parties, or the intention of Parliament, or the intention of whatever persons or body was or is deemed to have been the author of the instruments.”
[33]I state this well-known principle because it seems to me that the PO and of Ms Moore in her primary submission have lost sight of the clear purpose of the Regulations and focused too much on a linguistic and literal interpretation of the provisions.[34]In my judgment, the clear purpose of the scheme of the Regulations is to ensure that the individual concerned receives a guaranteed income equal to the relevant percentage of his average remuneration in accordance with the table in regulation 4(2). Accordingly, in calculating his allowance under the Regulations (ie his PIB) a deduction is made for income from other sources. So far as possible, that deduction should reflect the individual’s actual entitlement to the deductible benefit. Unless the Regulations cannot sensibly be interpreted in any other way, I would reject a construction which prevented a mistake from being corrected or which prevented PIB from being assessed by reference to IDB which should have been, rather than actually was, paid. I accept, of course, that the intention of Parliament is to be found within the Regulations themselves – at least, there was no other admissible material before the PO and there is none before me which throws light on the intention behind the Regulations. But that is not to say that a narrow literal approach must be taken without a view to the consequences.[35]Ms Moore gives the example of a clerical error by misplacing a decimal place. Suppose an individual has been informed of his or her level of IDB, and is actually receiving payment, of £5.55 per week when he leaves service; he is in fact entitled to £55.50 but by a clerical error the decimal point is in the wrong place and the zero has been lost. The error is spotted a week or so later and is corrected within the month. Can it really be the case that the individual’s PIB must, nonetheless, be calculated for ever on the basis of the incorrect IDB to the detriment of the individual? Or suppose the clerical error is against rather than in favour of the individual; can it really be that an error of that sort must be carried forward for ever? I would answer that the Regulations should be interpreted, if possible, in a way which would avoid such results.[36]I would approach in a similar way an error in the calculation of IDB which results not from a clerical or administrative error of that sort, but from an incorrect assessment of the individual’s degree of disablement for instance because the medical assessment is incorrect or because certain injuries have been rejected when they should not have been.[37]I readily accept that the scheme does, in the interests of simplicity, compromise to some extent the precise achievement of that purpose. I therefore do not disagree with the PO when he says, in relation to regulation 13(1)(b), that it is aimed at bringing a degree of certainty to an award of PIB and avoiding frequent reassessments following benefit rate changes. However, a change in IDB which takes place to put right something which was wrong from the beginning is, it seems to me, in a completely different category from a change which alters something propectively which was correct in the first place. Regulation 13(1)(b) is directed at the latter and cannot be prayed in aid as support for the rejection of the former.[38]I also accept that, in an extreme case, the situation could arise where an individual is entitled to receive, in aggregate, more than the maximum 85% envisaged in regulation 4(2). But such an imprecision at the boundary does not, in my judgment, detract from the purpose of the Regulations as I have described them.[39]Accordingly, I would reject the interpretation of the PO unless no other reasonable construction of the Regulations could be found without doing undue violence to the language of the provisions. But equally, I would reject the construction for which Ms Moore contends which would, like the PO’s approach, give permanent effect to the error. Indeed, on Ms Moore’s construction, it is only the fact that the BA did not seek to recover the overpayments from Mr Ingram when they reduced his IDB for the future in March 2003 which allows NHSBSA to continue paying what, objectively, is the wrong amount. It cannot be right, in my judgment, that the true amount of Mr Ingram’s PIB can depend on whether or not a third party, the BA, decides whether to reclaim overpayments of IDB.[40]I come then to the true construction of the Regulations. The central issue is the meaning of the phrase any of the following benefits, at the rate in operation at the date on which the employment ceased…., which are payable to the person…” in regulation 4(6)(b).[41]The PO, and to some extent Ms Moore, have read the words “at the rates in operation…” as if they referred to the rate at which Mr Ingram was receiving payment, the PO looking at what he in fact received under the first assessment of his benefit, Ms Moore looking at what he in fact received under the corrected assessment when the extra 2 accidents were taken into account (but, somewhat inconsistently, ignoring the correction of the clerical error in March 2003). I do not think that that is correct. In my judgment, the “rates in operation” is a reference to the method of calculation of benefit laid down in the statutory provisions relevant to the particular benefit (that is to say, under the six sub-paragraphs of paragraph (b)). This can be seen clearly in relation to paragraph (ii): section 30A SSCBA 92 sets out the entitlement to benefit and section 30B lays down the rate of benefit. It can also be seen clearly in relation to IDB itself under paragraph (i); Part V Schedule 4 sets out the “Rates of Industrial Injuries Benefit”, providing in a table different amounts per week payable in respect of different degrees of disablement. The relevant rate for the purposes of regulation 4(6)(b) is, in each case, that set out in the relevant provision. Since those rates could change, regulation 4(6)(b) makes clear that the rate is the one which is operable ie is in force, at the date of cessation of employment.[42]In order to fall within regulation 4(6)(b), the benefit has to be “payable”. In my judgment, the opening phrase of regulation 4(6)(b), read as a whole, is identifying the benefit to which the individual is entitled to be paid in accordance with the rates which I have just identified. An individual who is entitled to claim a benefit may not yet have done so. It could not, I think, be maintained that the benefit which he might obtain should be deductible under regulation 4(2); unless and until he claims, the benefit is not “payable”. But if he has made a claim, then the benefit is, I consider, “payable” and it is the eventual amount of that claim which should form the basis of the calculation of IDB.[43]The same result could, I think, be reached even if one were to adopt the approach of the PO and Ms Moore and focus on the amount of benefit payable. The PO said, and Ms Moore agrees, that the “rates in operation” must have regard to what actually happened. From that, the PO reached the conclusion that it was only what happened under the first assessment of IDB which was relevant, since changes other than commencement or cessation falling within regulation 13(1)(b) are to be ignored. In contrast, Ms Moore looks at what actually happened retrospectively, thus bringing into account the increase in IDB as a result of the 2 further accidents coming in, but ignoring the (non-retrospective) correction of the clerical error.[44]The basis for their approach appears to be the linguistic one that the draftsman could and would have used different words if he had meant to refer to the rate of benefit properly payable under the legislation. That, as so often, is an argument which cuts both ways. One might naturally assume that the draftsman was proceeding on the basis that what he had provided for would be observed so that, putting it simply, mistakes would not be made; it is implicit that “rates in operation” means “rates properly in operation” and that “payable” means “properly payable”. It can also be said that if the draftsman had intended to depart from that interpretation, he would have said so expressly by using words such as “any of the following benefits, at the rates actually in payment….”. I do not find the PO’s reasoning on this point at all persuasive.[45]Let me put this in context. Consider, for example, the case where no error is made. An individual applies for IDB; he leaves service and applies for PIB. Before his IDB application is dealt with, payment of his PIB commences. It will, presumably, commence without any deduction in respect of IDB. The IDB application is then dealt with arriving at a (correct) figure. Putting aside for the moment precisely what “the operable rate” means, the rate at which the benefit is being paid as at the date of termination of employment will then be known and that can be expressed as an annual amount for the purposes of deduction under regulation 4(6)(b). It will follow that the individual has been overpaid PIB during the period between leaving service and a decision on his IDB. But that overpayment should be capable of recovery by set-off at least against future instalments.[46]The alternative view is that one must look only at what is actually being paid (or at least has been certified by the BA as due for payment) at the date of leaving service and that future payment of IDB cannot be taken into account even though the IDB is referable to a period which straddles the date of leaving service. In the example, the amount actually being paid at the date of leaving service is nil. This does not, however, lead to the obviously wrong conclusion that IDB cannot be taken account of at all. When IDB comes into payment following determination of the application, regulation 13(1)(b) comes into play so that the amount of the PIB can be reviewed albeit only prospectively. This is unsatisfactory, in that it gives the individual a windfall.[47]It might be said, against the view which I have expressed, that, even on that view, regulation 13(1)(b) would apply when the IDB actually commences payment and that it would be odd if IDB should both be taken into account in assessing, retrospectively, the PIB and at the same time trigger a review. I accept that it would be slightly odd, but it leads to no inconsistencies or anomalies and follows simply from the difference between a benefit being “payable” and its actually being paid.[48]In the example I have considered, no error was made. However, if an error is made, as in the present case, and that error corrected there is, in my judgment, no difference in principle. The “rate in operation” remains the statutory rate which should have been applied and the benefit “payable” is the one which should all along have been paid. I reject the PO’s construction which would result in PIB being assessed for all time on the basis of a rate which was not that which was operable ie laid down in the statute and on the basis of a measure of IDB which was never “payable”. For the same reasons, I reject Ms Moore’s primary construction which leaves the clerical error uncorrected so far as it impacts on PIB and fails to reflect the “rates in operation” or the amount “payable”.[49]Further, it seems to me that the PO’s approach lacks a certain logic. He appears to have been willing to treat the first assessment of IDB as establishing the “rates in operation” at the date when Mr Ingram left employment. He was thus willing to give retrospective effect to a benefit which came into payment after that date. But if it is correct to do that, why, I ask myself, is it not permissible to give retrospective effect to a correction of that incorrectly assessed benefit. I can see no good reason at all.[50]The only way out of that difficulty is to reject the proposition that the first assessment does fix the “rates in operation” and to say that the IDB at the date of leaving service was nil. PIB would then be reviewed, under regulation 13(1)(b) when it in fact came into payment. But that would leave Mr Ingram with a windfall if PIB had been paid to him, as on this approach it should have been. And, perhaps more significantly, it would leave the individual in the example given at paragraph 46 above with a windfall even where no mistake of any sort had been made. It would also mean that the correction of an error in the assessment of IDB would not follow through to a correction of the corresponding error in the calculation of PIB since there would be no “commencement” of benefit triggering a review under regulation13(1)(b). These consequences lead me to reject this approach.

Conclusion

[51]NHSBSA’s appeal is allowed. Mr Ingram is not entitled to PIB calculated on the basis of an IDB as assessed on the first assessment in June 2001. However, I do not accept Ms Moore’s argument that PIB should be based on the result of the November 2007 review. PIB should be assessed on the basis of an IDB which reflects the correction of the clerical error in March 2003. This was the result of the second stage of the internal dispute resolution. Mr Ingram’s complaint was about that result. His complaint must accordingly be rejected.