Offset for crime negligence or fraud
T5.—(1) If a loss to public funds occurs as a result of a member’s criminal, negligent or fraudulent act or omission, the Secretary of State may reduce any benefits or other amounts payable to, or in respect of, the member (other than guaranteed minimum pensions and benefits arising out of a transfer payment) by an amount equal to the loss.
(2) If the loss to public funds is equal to or greater than the value of the benefits or other amounts payable to or in respect of the member, a reduction under paragraph (1) may result in the benefits ceasing to be payable.
(3) The Secretary of State shall give the member a certificate specifying the amount of the loss to public funds and of the reduction in benefits.
(4) If the amount of the loss is disputed, no reduction in benefits will be made until the member’s obligation to make good the loss has become enforceable under the order of a court or arbitrator.
(5) Where the loss referred to in paragraph (1) is suffered by an employing authority, the amount of the reduction in benefits will be paid to the employing authority.