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Daily Telegraph
MoD refuses to repay 42 years of back tax
By Michael Smith, Defence Correspondent
Last Updated: 1:11am GMT 23/02/2002
THE Defence Ministry is refusing to repay tax wrongly deducted from a war veteran's pension for the past 42 years, saying it will compensate him for only the last two years.Major Richard Perkins, who was mentioned in dispatches for his part in Operation Thursday, the 1944 Chindit operation behind Japanese lines in Burma, is 83 and living in rented accommodation in Lastingham, North Yorks. . . . . . . .
. . . . . .Thousands of former soldiers were owed millions because of the error, which was uncovered by Major John Perry only after a series of denials by the MoD.
When Major Perkins was told that, since his disability was not attributable to service, he was not entitled to a tax-free pension, he decided to appeal.
The Pensions Appeal Tribunal, an independent body, ruled in August that his pension should have been attributable and therefore tax-free.
The MoD made the adjustment on his pension but was prepared to repay tax owing only for the past two years.
It has subsequently told him that it cannot backdate the tax without authority from the Inland Revenue, which has said it cannot do anything without MoD authority.
Major Perkins said the MoD appeared to have plucked the two-year date out of the air.
"Some officials treat elderly pensioners with contempt. I do not mind if the Inland Revenue, the MoD or Gordon Brown pays me out of his back pocket, or Father Christmas. But payment is due in full."
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Soldier sues MoD
Last Updated: 3:58pm GMT 08/11/2002
Retired Major Richard Perkins is suing the Ministry of Defence to reclaim tax paid on his Army disability pension for more than 42 years.
Major Perkins, 84, is owed thousands of pounds after retiring from the Royal Leicestershire Regiment in 1959. He suffered a breakdown, resulting from active service in the Malayan emergency of 1955, as determined when he appealed last year for reassessment.
However, the MoD has insisted that his tax rebate should only go back to the date of his appeal, and he has only received £800.
In a letter from Lewis Moonie, the Parliamentary under-secretary of state at the MoD, Major Perkins was told the Veterans' Agency had not awarded him a gratuity or pension on the basis of his disability because he was "not suffering any assessable degree of disablement".
Major Perkins said: "Dr Moonie and his staff can offer no explanation of what they mean by this, such as when was this assessment of disability dated from? It makes no sense."
An MoD spokesman said: "It is a decision for the Inland Revenue whether someone's status is taxable or not."
So, from next April, Major Perkins will have his pension taxed again. He said: "It's a disgrace. I have spent four years fighting in my late retirement. I am going to Oxfam for my clothes, not being able to return hospitality. I'm increasingly in debt every month because my rent and my council tax are more than my income. This is a rather strange way that people reward their old soldiers."
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Daily Telegraph
Major who took on MoD and won
Last Updated: 12:01am GMT 24/01/2002
JOHN PERRY, the retired major whose persistence in the face of bureaucratic denials led to the Ministry of Defence's retreat over money owed to soldiers disabled in the service of their country, is now what he describes as "a very young 70".
But in the 1950s, he was an extremely fit and high-flying officer in the Royal Artillery. As a young officer during the Korean War, he had taken part in the Battle of the Hook when he saw at first hand the damage wrought by the British guns on the Chinese conscripts who attempted to advance on their flank.
The next day he was put in charge of a party of men burying the enemy bodies. "We came across the ridge and saw what I can only describe as lots of bits of meat," he said. "Some of them were very young boys, blown to bits by my guns. The smell was dreadful." The image stayed with him but did not appear to affect him. His career was highly successful. When the army decided to set up a commando artillery regiment to support the Royal Marine commandos, he was the first officer on the list.
In the late 1960s, at the height of his army career, he was posted to a staff job at the MoD, working out where the artillery would attack advancing Soviet troops in the event of a Third World War. The posting was expected to be the prelude to further promotion to the rank of Lieutenant-Colonel and his own regiment. Instead, his career came to a sad and abrupt end.
Planning how to kill Soviet soldiers brought back the memories of the young Chinese conscripts in Korea and led to a mental breakdown, a three-month spell in an army psychiatric home and a medical discharge in 1971. Even when he finally received his own rebate, he continued pursuing the MoD, insisting that they should find everyone else affected.
Apologising for the error in the Commons, Lewis Moonie, a defence minister, said: "Major Perry deserves to be commended as it was his persistence that brought this to light."
Maj-Gen James Gordon, general secretary of the Forces Pensions Society, said the error had only come to light as a result of Maj Perry's "single-minded campaign for justice".
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Disabled major, 84, sues MoD for pension tax
By Michael Smith, Defence Correspondent
Last Updated: 8:14pm BST 20/10/2002
A Second World War veteran is to sue the MoD for thousands of pounds in tax wrongly paid on his Army disability pension for the past 42 years.
The Daily Telegraph disclosed in January that large numbers of disabled veterans were owed millions of pounds in tax charged.
Major Richard Perkins, 84, was the only one of the victims to be mentioned specifically by name by Lewis Moonie, the veterans minister, when he apologised to Parliament in January for the blunder. Dr Moonie told MPs: "I shall ensure that it is resolved as quickly as possible."
Nine months later Major Perkins is no nearer to receiving his money.
Major Perkins, who was mentioned in dispatches for his part in Operation Thursday, the 1944 Chindit operation behind Japanese lines in Burma, is living in rented accommodation in Lastingham, North Yorks.
His pension is £50 more than his rent. He retired from the Royal Leicestershire Regiment in 1959 after suffering a mental breakdown, which, following an appeal, was attributed to his service.
The MoD has insisted that the pension only became tax-free from the date of an appeal in August last year and so far Major Perkins has received only £800. The MoD refused to comment.
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MoD still in its bunker
Last Updated: 5:31pm BST 05/07/200
Pension refunds ordered a year ago have not been paid, says Alison Steed
Being unable to afford a holiday for four years, or even to pay for a pub lunch, has led former Army Major Richard Perkins, 84, from Lastingham, North Yorkshire, to "resent every day since last August".
That was when the Pensions Appeal Tribunal for England and Wales confirmed he had been invalided out of the Royal Leicestershire Regiment due to his service in 1959, which meant his pension should have been paid tax-free. Yet nearly a year on, and almost five months after his plight was highlighted in The Daily Telegraph, the Ministry of Defence (MoD) still has not repaid the tens of thousands of pounds in tax wrongly deducted from his invalidity pension over 42 years. Major Perkins was mentioned in dispatches for his part in Operation Thursday, Wingate's 1944 Chindit operation behind Japanese enemy lines in Burma. In desperation he has written to the defence minister, Lewis Moonie.
He wrote: "In six weeks it will be a year since the Pensions Appeals Tribunal found in my favour, a year of continual stress and litigation, yet you claimed in the Commons on January 23, 2002 to be the Minister for Veterans with a remit to make life easier for those of us who have served our country.
"In practice you and your department have done virtually nothing to support me, as an 84-year-old ex-serviceman. Instead, you have chosen to lie low, putting every obstacle in my way. If you will not now accord me justice you leave me no alternative but to seek a ruling via the Courts, or ultimately from the European Court of Human Rights."
Major Perkins lives in rented accommodation, and only manages to get by because his son sends him money from Australia each month.
He said: "I loath all this. My interest is in writing books and poetry, and I haven't got that much time to get back to it."
Pensioners invalided out of the forces due to injuries attributable to, or aggravated by, their service, should not pay tax on their pensions, but many did, and still do. They can claim rebates from the MoD. If the pensioners themselves have died, next of kin are still entitled to claim the rebate.
Major Perkins is just one of 3m servicemen and women invalided out since 1919, although around 1.4m of these would not be eligible for rebates because they received lump sums, said the MoD.
The administrative errors affect Army and Royal Navy pensions paid from as far back as 1919, and could have affected the Royal Air Force between 1919 and 1952. Those entitled would have to have been regular soldiers rather than reservists.
They would also have had to serve a number of qualifying years, which has changed over time. Before 1945, it was 14 years; for 1945 to 1972, 12 years; for 1973 to 1987, five years; and from 1988 onwards, two years.
Dr Moonie apologised for the "deeply regretted" error in wrongly taxing these pensioners in the Commons in January. He also assured John Greenway, Major Perkins' MP, "that the matter will be dealt with as quickly as possible".
Major John Perry, whose dogged campaign exposed the MoD's error, was also commended by Dr Moonie in the Commons. He added: "I believe that because the Government are responsible collectively for what was done in their name in the past, we should leave no stone unturned in attempting to find any further people who are liable, and ensuring that they are given payment."
However, it was only last week that the MoD started an advertising campaign to encourage those who think they are eligible for rebates to apply. So far Major Perkins has only received £800, dating back to August 25, 1999. He said: "I resent every day since last August when after a two-and-a-half-year fight against the implacable opposition of the War Pensions Agency, I won my appeal and proved that I was entitled to the full rebate and compensation.
"I waited for my 42 years' reimbursement to drop through the letterbox. I am still waiting almost a year later.
"They have indeed paid me for two years, and fought tooth and nail ever since to deny me the balance, defying the law which would be transparently clear to any bright schoolchild."
The law to which he refers is the Income and Corporation Taxes Act 1988. It states that income from disability pensions "shall be exempt from income tax", which includes the "retired pay of disabled officers granted on account of medical unfitness attributable to, or aggravated by, naval, military or airforce service".
Major Perkins added: "Even if the law was not specific in this case, as it is, there is Common Law, there is compassion, there is decency, to which a claim is justified for those who once fought for the present peace and comparative security of our populace, including its civil servants."
Letters have also been sent to Dr Moonie on his behalf by Gerald Howarth, the shadow defence secretary, and Mr Greenway. Mr Howarth said: "It is unacceptable that he should have had to wait so long for the reimbursement of tax which the Government accepts to be due.
"The minister just put up a brick wall at the MoD, and it appears they are refusing to address the issue." Dr Moonie was unavailable for comment.
Sarah Hayward, of the MoD, said: "We are aware he is not getting any younger, and it will be sorted out as soon as we can. "There are complicating factors in the interpretation of the rules. The issue is not just that, but arguing about the backdating of pensions and when it should be paid from. We need to get it right from a legal viewpoint."
Paul Keetch, the Liberal Democrat defence spokesman said: "They could have a 'no fault' payment. That would be a generous act of a caring government.
"We should get this sorted out as soon as possible."
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Officials buried veterans' files
By Michael Smith, Defence Correspondent
Last Updated: 11:31pm GMT 12/12/2002
An inquiry into why thousands of disabled forces' veterans were charged tax they should never have paid has uncovered a catalogue of "systematic failings" and a culture in which civil servants did not care if veterans were properly treated.
The investigation was ordered by Lewis Moonie, the veterans minister, after he found that officials had misled him over the seriousness of the problem. It is scathing of the way pensions were administered. At one point in the 1950s, civil servants handling Navy pensions deducted tax they knew should never be paid simply because they disagreed with the law, the inquiry found.
"The Admiralty for a time deliberately did not draw the attention of ratings to the tax exemption because efforts were being made to abolish it," the report said.
But it was most critical of civil servants administering Army pensions during the 1990s among whom there was a "deep rooted" culture in which it was thought not to matter if veterans were robbed of their entitlements. Faced with a backlog of cases, civil servants filed thousands away without processing them, the inquiry said. This not only left more than 350 disabled soldiers paying tax they should not have paid but resulted in them not receiving their proper pensions. "There was both a failure on the part of the management to recognise that cases were being filed away when actions remained outstanding and, more fundamentally, to create an ethos in which staff were sufficiently customer-orientated that it would be unthinkable to allow such a thing to happen."
The inquiry also confirmed that the problem was far deeper than thought, going back to 1919 and affecting all three Services. It was "impossible to say how many errors had been made".
The inquiry was ordered after The Telegraph disclosed in January that thousands of disabled servicemen and women whose pensions should have been tax-exempt had paid millions of pounds.
Tony Blair apologised publicly but Dr Moonie resisted an inquiry, telling MPs that the problem had affected only the Army, went back no further than 1952 and would cost only £6 million to put right. But as it emerged that the error went back to 1919 and that veterans had been wrongly charged £30 million, involving the Navy and the RAF as well, Dr Moonie agreed to an internal inquiry. This quickly discovered that even after the problem was realised civil servants did not react properly to inquiries from veterans and relatives. Replies sent out by the Armed Forces Pensions Administration Agency in Glasgow blamed the media and told some pensioners they were not involved when they were.
"Many of the letters have left much to be desired in terms of tone as well as substance," the inquiry found, adding that inaccurate advice was also given to ministers and as a result to Parliament. The report found that the compensation was inadequate and that efforts to rectify this were being hampered by the Inland Revenue. At best the refund would leave many pensioners worse off than if they had put the money into a National Savings account, said the inquiry. At worst they had effectively given the Government an interest-free loan.
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Disabled veterans died before MoD admitted error
By Michael Smith, Defence Correspondent
Last Updated: 8:42pm GMT 13/12/2002
Disabled veterans who were told earlier this year that they were unaffected by an MoD pensions blunder died before it was established that they were each owed thousands of pounds in wrongly deducted tax, it was disclosed yesterday.
An inquiry into the error found that officials at the Armed Forces Pensions Administration Agency in Glasgow told large numbers of people that they were not affected when they were.
The agency was inundated with inquiries from former servicemen and women after The Telegraph revealed in January that thousands of disabled veterans had been wrongly charged millions of pounds tax on their pensions.
Hundreds of standard letters were sent out blaming the media for "misleading" veterans and telling them they were not eligible for a refund. But the advice was based on "ill-founded assumptions", the inquiry found. Attempts by the inquiry team to review the cases were hampered by the fact that the proper paperwork had not been carried out and by the time some claimants were re-contacted they had died, Lewis Moonie, the veterans minister, who ordered the internal inquiry, told the Commons.
"I much regret that in several of the cases recently re-examined a pensioner, previously misadvised that his pension was correctly taxed, has died before an error was recognised," he said.
"In such cases the tax refund is to be paid, with due apology, to the pensioner's widow or estate."
The "important omissions" uncovered by the inquiry meant that the review was likely to take until next summer, but priority was being given to reviewing cases where the serviceman or woman affected was elderly.
"We are very much aware of the importance of giving as much priority as possible to examining the cases of our oldest pensioners," said Dr Moonie.
Even where veterans who wrote to the agency were correctly advised that they were owed tax, the letters sent out were wholly inadequate, the inquiry found. Officials had worded the letters to make it appear that the entitlement had only just occurred as opposed to being a long-standing error for which compensation should be paid, said the inquiry's report. "When examining cases in which refunds had been made, we expected to find on the file letters to the pensioner containing:
• an acknowledgment that the Service pensions staff had made a mistake;
• an apology for the error;
• a clear explanation of what refund or refunds were due; and
• sufficient details for the pensioner to be able fully to understand the basis on which the refund had been calculated.
"The letters we have seen contained none of the above."
The report added: "By failing to convey that the entitlement arose some years previously, but had only just been recognised, the letter may have misled the pensioner into thinking that no question of interest for the period of delayed payment arose."
John Perry, the former Army major who uncovered the error and fought a four-year campaign to get MoD civil servants to accept they were wrong, said the report confirmed what I have been saying for the past five years - that there was a culture among the MoD civil servants handling pensions in which they were simply not attuned to the fact that they were dealing with real people who had done something in the service of their country."
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Is this what the MoD are hoping for? [Editor]
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Taxman blocking veterans' refunds
By Michael Smith, Defence Correspondent
Last Updated: 1:49am GMT 16/12/2002
The Inland Revenue is blocking attempts to compensate disabled veterans whose pensions were incorrectly taxed, refusing to release vital information because of "difficulties both of principle and practice". The move makes it virtually impossible for the Armed Forces Personnel Administration Agency to calculate compensation for those affected and in some cases is preventing any repayment at all.
An internal Ministry of Defence inquiry also found that some of the cases had been caused not by the MoD but by the Inland Revenue. During the 1980s it "erroneously issued tax codes to certain tax-exempt pensions". Lewis Moonie, the defence minister with responsibility for veterans, is expected to tell MPs later this week that there is nothing his officials can do in the face of the Inland Revenue's refusal to help. He will face intense questioning from the Commons Defence Committee over the affair in which thousands of disabled servicemen and women were deprived of millions of pounds in pensions.
The internal inquiry admitted that it was impossible to say how many people were affected. The pensioners had effectively given the Government an interest-free loan and should be properly compensated as well as being repaid. But attempts to work out how much individual pensioners should receive in compensation was impossible because the Inland Revenue had calculated the refund and was refusing to give details to the MoD. "We understand from the Inland Revenue that they see difficulties both of principle and practice in providing this information," the inquiry said in its report.
But not only is the Inland Revenue refusing to release information needed to compensate those affected, in some cases it is also actually blocking repayment. It is refusing to give a refund to anyone discharged for medical reasons initially ruled not to be caused by service, and therefore not eligible for a tax-free pension, but who subsequently successfully appealed against the ruling.
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Veteran wins his battle
By Alison Steed
Last Updated: 4:54pm BST 20/05/2004
War veteran Richard Leigh Perkins has finally won his six-year battle with the Government to be repaid tax wrongly deducted from his invalidity pension since 1959. . . . . . .
He said: "I can now get on a bit more with my life. I write a great deal, essays and poetry for various journals, and I have a whole lifetime of a book to put together. These are things that I have had to put aside for years, and when you have not got much time left, it is maddening that you cannot get on with these things."
Major Perkins is unsure how much he is due, but expects "a hell of a fight to get the promised compensation". The Ministry of Defence has said it will pay compound rather than simple interest to compensate thousands of soldiers who lost out.
Major Perkins has been helped in his quest by his MP John Greenaway, and said the publicity he received had been beneficial. He said: "The press coverage alerts other people to the issue, and each time it brings in other claims."
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Burma veteran lives in poverty as he fights MoD
By Thomas Harding, Defence Correspondent
Last Updated: 1:51am BST 26/06/2006
An 88-year-old veteran of the Burma campaign is living in penury because Whitehall bureaucrats are refusing to pay him full £86,000 recompense after a pension error.
Tomorrow, when the Government will trumpet Veterans' Day to honour those who risked their lives for Britain's freedom, Major Richard Perkins will remain at home musing on his battle with the Ministry of Defence. For five months during the 1944 Chindit campaign he led 30 soldiers behind Japanese lines. But he says the deprivations he suffered in the Burmese jungle are nothing to the seven-year campaign he has waged for compensation that the MoD refuses to recognise.
Major Perkins was among hundreds of medically discharged veterans who were incorrectly taxed on their pension, an error that emerged in 1998. Millions of pounds in compensation were paid but he was at first denied the rebate on taxation paid over 42 years because the ministry said he had not been discharged for medical reasons.
He fought for five years, employing lawyers and a psychiatrist, to prove that his later service during the Malayan emergency had contributed to a mental breakdown. After an appeal tribunal, the MoD paid £20,000 for the tax error but refused to pay interest estimated at £86,000.
Once again Major Perkins, a father of four children from two marriages, had to fight. He pays £20 every month towards legal aid as he tries to have the case heard in the High Court. He survives on a state pension plus an Army stipend of £463 a month. Out of that he pays £435 rent for a home in Lastingham, North Yorks.
Major Perkins's MP, John Greenway, the Tory member for Ryedale, said: "It is time the MoD did the honourable thing and gave him the compensation he is entitled to."
The ministry advised Major Perkins to contact the Inland Revenue, as it was a matter of "tax legislation". Major Perkins accused it of "passing the buck". (hightlighted by the editor)
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DailyTelegraph
Yesterday in Parliament
Last Updated: 12:01am GMT 24/01/2002
MPs want heads to roll over MoD blunder
Blair apologises over £30m tax mistake on Army pensions
THE Government was accused yesterday of a "cover-up" at the Ministry of Defence of the Army pensions blunder which deprived former soldiers and their widows of £30 million.
Some MPs insisted that "heads should roll" at the MoD and there should be a full-scale investigation coupled with a Commons debate on the fiasco.
Lewis Moonie, the minister handling the matter, said he did not want to turn the controversy into a party political issue and he had no appetite for an inquiry into what went wrong 50 years ago.
Due to an administrative error in the Army Pensions Office in the 1950s, many had their attributable invaliding pension taxed mistakenly.
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Yorkshire Post
Six-year fight for justice could lead to £40,000 payout Pensions tax victory for Army veteran
Published Date: 19 May 2004
Chris Benfield
WAR veteran Richard Leigh Perkins was last night celebrating victory over his last and trickiest enemy – the Ministry of Defence.
The Ministry has finally admitted a mistake made 45 years ago, which meant Major Perkins's Army pension was wrongly taxed.
The admission is a victory for persistence. The 86-year-old major, of Lastingham, near Pickering, North Yorkshire, has made a full-time job out of campaigning for his money since the Ministry refused to include him in its big concession on the tax issue, six years ago.
Now he can expect tens of thousands of pounds in refunds and compensation, after years of financial struggle.
He has paid tribute to the efforts of his local MP John Greenway, who pushed the case to a conclusion by lobbying the Minister for Veterans' Affairs, Ivor Caplin, who was appointed a year ago.
Mr Greenway himself commented last night: "This is one of those victories that makes my job worthwhile. David has beaten Goliath."
The major was mentioned in despatches for his wartime exploits in Burma with the Royal Leicestershire Regiment, but ended up suffering a nervous breakdown in Malaya in 1959, when he was 41. He was invalided out of the Army, his marriage broke up and he commuted some of his pension entitlement for a cash sum to settle his divorce.
None of his civilian jobs earned any pension, so he ended up living on a reduced Army allowance – about £420 a month now, of which he loses about £25 to the Inland Revenue.
He thought he would get the money back when other veterans won a test case in 1998 to establish that "war pensions", arising from disability caused by service should be tax-free. The Royal Navy and the RAF had always made sure that most of their veterans were treated correctly by the Inland Revenue – although they had made some mistakes – but the Army had thousands of injustices to put right.
Maj Perkins said his case was one of them. But the Ministry argued. First, it said his breakdown was not the Army's fault – and he had to go to a tribunal to win that point in 2001. Briefly, he got the tax concession, although no back pay. Then the MoD put him back to square one by arguing that because he had recovered, there was no disability element in his pension. Now it
has conceded that there is and always was such an element.
Mr Greenway, the Tory MP for Ryedale, commented yesterday: "I don't know why the Ministry put up such a resistance in his case. But it does make me wonder whether there are others who still have not been fairly dealt with."
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Yorkshire Post
Major goes to war for elderly
Published Date: 13 November 2004
Chris Benfield
CASH gifts to pensioners from their children could leave them out of pocket by scuppering their state benefits, unless a retired Yorkshire Army officer wins a test case affecting the financial future of Britain's elderly.
Former Major Richard Perkins faces having to pay back nearly £8,000 – five-and-a-half years' worth of benefits – because Ryedale District Council says the money his son was sending him each month counts as income.
The Department of Work and Pensions has asked the Appeal Court to rule in favour of the council, to close off a potential loophole in social security law.
And if the Government wins, that could mean millions of people on benefits losing out, and not just pensioners, because their families have given them regular cash support.
The pensions department wants to establish its agencies can take all sorts of unofficial payments from relatives into account when paying housing benefit, income support and council-tax rebates.
Mr Perkins told the Yorkshire Post: "The Government is effectively saying that if I get a present from my son, it wants its share.
"I think it is abominable interference in normal relations between members of a family."
This is the second time Mr Perkins has taken on the authorities.
The war veteran this year won a landmark case against the Ministry of Defence because his pension had been wrongly taxed for 45 years after he was invalided out of the Army – although he has not yet had the money he says he is owed.
He had been fighting the case since 1998, while living on very little money, and says the subsidy from his eldest son, who lives in Australia, mostly went on telephone bills, postage, motoring to and from his nearest post office, and other costs arising from his situation.
Three years ago, while still heavily involved in the pensions case, Ryedale District Council asked to see his bank accounts as part of a routine check and spotted the £280-a-month payment.
Mr Perkins explained what the money was but in October 2001 the council stopped its contribution of about £30 a week towards his rent and demanded repayment of £7,770, for the previous five-and-a-half years.
A local appeals tribunal upheld the council decision in May 2003. But the Social Security Commissioners, a body of specialist judges, appointed from the legal profession, overturned it in a written ruling in January this year.
Commissioner Mark Rowland, who wrote the judgment, said the housing benefit form used by Ryedale Council was confusing and so were the rules allowing some income to be disregarded, which had been altered between 1987 and 1990.
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