Thank you for sharing!

Your article was successfully shared with the contacts you provided.

With Sir Fred Goodwin and Bob Quick receiving controversial pension payouts, the question is: in what circumstances can forfeiture occur?

Few people have received such negative press in recent years as Sir Fred Goodwin, the former CEO of the Royal Bank of Scotland (RBS). He refused to surrender an annual pension of £703,000, even though RBS was rescued by the Government and suffered the largest-ever yearly loss in UK corporate history. The latest reports indicate that the Government is taking legal action to clawback some of the pension.

Similarly, Bob Quick, the former head of anti-terrorism for the Metropolitan Police, was criticised when it was revealed he would receive a pension of £110,000 a year despite the circumstances of his resignation. (He resigned from his post after allowing top secret documents to be photographed.)

The size of the pensions in question – vastly in excess of what the average pensioner would receive from an occupational pension scheme – has obviously contributed to the controversy.

But it must be remembered that a pension is earned by past service and so the law restricts the circumstances in which an employee’s pension can be forfeited. This follows the line recommended by the influential 1993 Goode Report on Pension Law Reform which, while not favouring complete abolition of the ability for pension benefits to be forfeited, suggested that forfeiture should be narrowly defined by legislation.

The consequent Pensions Act 1995 allows forfeiture only in the following circumstances, but the rules of the specific scheme would also have to allow the forfeiture to occur:

This premium content is reserved for
Legal Week Subscribers.


  • Trusted insight, news and analysis from the UK and across the globe
  • Connections to senior business lawyers within the leading law firms and legal departments
  • Unique access to ALM's unrivalled, market-leading reporting in the US and Asia and cutting-edge research, including Legal Week's UK Top 50 and Global 100 rankings
  • The Legal Week Daily News Alert, Editor's Highlights, and Breaking News digital newsletters and more, plus a choice of over 70 ALM newsletters
  • Optimized access on all of your devices: desktop, tablet and mobile
  • Complete access to the site's full archive of more than 56,000 articles

Already have an account?

For enterprise-wide or corporate enquiries, please contact Paul Reeves on Preeves@alm.com or call on +44 (0) 203 875 0651


Legal Week Newsletters & Alerts

Sign Up Today and Never Miss Another Story.

As part of your subscription, you can sign up for an unlimited number of a wide range of complimentary newsletters and alerts. Get the timely legal news and critical analysis you cannot afford to miss. Tailored just for you. In your inbox. Every day.

Copyright © 2019 American Lawyer Media International, LLC. All Rights Reserved.