By SHARON KEMP

Thursday 24 May 2001

The Victorian Government has overquoted by more than $67 million the amount of pension that would be paid to a group of pensioners' spouses if they chose to convert payments to a lump sum.

The error occurred when Victoria's Government Superannuation Office asked 50,000 pensioners, including surviving spouses of dead members, to choose between the government pension and a lump sum under the Beneficiary Choice Program designed to reduce Victoria's $13.5 billion unfunded pension liability.

The GSO has apologised to 3360 spouse pensioners who were told their lump-sum payment would be on average $20,000 more than it should have been.

A total of 1450 of the group had elected to receive the lump sum based on the quotation. They will be given the opportunity to defer their decision until October after the deadline to opt for the lump sum option closed last Friday. GSO chief executive Denzil Griffiths said that after affected pensioners had been notified, most had decided to make no change.

He said the error occurred when pension records were transferred to a new computer system in the early 1990s. Because the data was not used for any other purpose, the mistake was picked up only when election forms were processed as part of the program. "I would like to reassure all pensioners that their current fortnightly pension payments are correct," Mr Griffiths said.

Under the program, pensioners can opt to convert half or 100 per cent of their pension to a lump sum. More than 90 per cent of pensioners had responded by yesterday.

http://www.theage.com.au/business/2001/05/24/FFXEYVAN2NC.html

-- Anonymous, May 24, 2001