PFEW agrees ‘principle terms’ of pension settlement

18 November 2024

CEO Mukund Krishna highlights commitment to transforming PFEW and admits there have been 'leadership failings' in the past.

The Police Federation of England and Wales (PFEW) has agreed “principle terms” on a settlement for the claimants who were subject to age discrimination by the organisation, its CEO has confirmed.

A ruling handed down in June 2023 found that the PFEW had discriminated against members who had previously made claims against the government over the transitional pension protection arrangements.

The transitional protections introduced in 2015 were found to be discriminatory in and of themselves.

A total of 9,989 individuals pursued legal action, and were ultimately successful.

The judgment has had huge financial and reputational ramifications for the PFEW.

CEO Mukund Krishna frankly admits that mistakes were made and those failings contributed to the PFEW losing “possibly the biggest litigation of recent times within policing”.

“I’ve said this before and I’m not going to say anything different, but there have been leadership failings in the past, which is why we are where we are,” he told Police Oracle.

He was appointed in July 2023 with a “two-fold” remit: secure a future for the PFEW, and rebuild it so the same mistakes aren’t made again.

Agreeing the outline of a settlement for those affected by age discrimination advances that first objective.

Mr Krishna said: “We have recently, very, very recently, agreed on the principle terms of the settlement…which is huge. That allows us to have a future; we’re of course not going to get into the numbers, because it’s all protected, but we understand that the vast majority [of claimants] have accepted the offer.”

While “we still haven’t signed on the dotted line” due to ongoing work around the broader terms of the settlement, the CEO says that agreeing principle terms is a “very important milestone”.

“Twelve months ago, this time last year, we were at the brink of an existential crisis and we’ve come this far…and it’s been hard work on both sides, but we’ve got there.”

This is not the first time the CEO has spoken of the PFEW facing a potential existential threat.

At last October’s virtual conference, he admitted the organisation is “not financially designed to withstand these types of group claims” and said that difficult decisions were inevitable.

Speaking this week, he sought to reassure members that core services have been protected.

“We’ve had to reduce spend in some areas to contribute to the settlement, but we managed to do that without compromising on the services we deliver to the membership…so we have protected the budget for funding claims, we have protected the budget for training our reps, we haven’t compromised anywhere there…we have identified other areas which are non-core areas of the business.”

Mr Krishna said the specifics can’t be discussed at this stage as conversations remain “legally privileged”.

As for whether the Leatherhead HQ will be sold, he didn’t rule it out or in.

“Well certainly what I will say is we have had to put everything on the table we own as the national body, which includes 11 flats. They all contribute one way or the other towards the settlement…”

It’s unclear at the time of writing whether, as per a previous suggestion, £60m is the amount that will be required to settle the claim.

The pension judgment exposed failings within the PFEW that required more than self-evaluation. That is why the decision was taken to commission an independent review into the organisation.

The first phase – due to complete in October – has focused solely on failings related to the pensions claim, while the second will look at how the PFEW needs to change and reform.

“We always said that the findings of the review will be published in the autumn of this year, so we are still within the timeframe of the autumn…”

Mr Krishna is eagerly waiting for the panel to identify the findings but understands they have been consumed by travelling across England and Wales to gather “observations” from all the relevant stakeholders.

While there’s still a degree of mystery as to those findings, he’s under no illusions.

“I would anticipate that it is going to hold up a pretty strong mirror at us as an organisation and call out the issues that have led to the situation that we are currently in.

“I will have to wait and see what comes back from the panel…yes, a multimillion pound litigation that cost tens of millions of pounds is something that we’ve lost, it’s possibly the biggest litigation of recent times within policing…so I would expect that to be reflected in the findings.

“I don’t know what the findings are; it just cannot be the leadership failings, I’m sure there has got to be more to it…otherwise why would we have lost that litigation? I think the devil’s in the detail.”

However damning the findings are, the CEO is clear that he has a responsibility to publish them.

Resolving the pension settlement will go some way towards securing a future for the PFEW. The second part of his remit, namely rebuilding the organisation, is a “much longer journey”.

“Change is not going to happen overnight. The words we use within the Federation are ‘survival’ and ‘simplification’ – survival was all about how do we come out of the existential crisis, and simplification for us is all about how we don’t do the same mistakes again…”

Mr Krishna has spent much of his tenure to date meeting members up and down the country, having done over 20 roadshows so far.

He says the themes have been “consistent”.

“They are asking us, ‘where is the Federation when we need them?’, because they didn’t have the Federation when they needed them in the past…and that comes up in the form of, ‘can we have a professional organisation, can we have a better culture or improved standards?’…”

While there’s clearly a desire to improve culture and standards, what can’t be ignored is that two senior figures within the PFEW – national chair Steve Hartshorn and Met Police Federation chair Rick Prior – remain under PFEW investigation.

Mr Krishna declined to comment on individual cases, but accepted they could be destabilising for an organisation trying to reform.

“Some of these high-profile roles will have an impact, one way or another…I accept that, and from our perspective we want to try and minimise the impact, but we also have a duty to follow the process fairly and consistently.”

Whatever the potentially destabilising influence, the CEO says he remains “laser focused on driving through the changes” that need to be made.

When asked for examples of those already made, he offered two examples.

“We’ve started showing already where the subscriptions are being spent…we only started that for the first time, we are showing where the money is going.

“We are also communicating more proactively with the membership…we’ve engaged with them recently on an industrial rights poll, we’ve never had over 55,000 officers responding to an industrial rights poll, or any poll or any survey from within the Federation.”

In terms of pursuing industrial rights, Mr Krishna says the “mandate is very clear” – over a third of the membership have said they would like the PFEW to negotiate collective bargaining.

Discussions “to try and make that work” continue with stakeholders, while the Labour government has been made aware of the PFEW’s position.

This has always been an “18-24 months piece of work”, he added.

It’s no secret that the decision to appoint an unelected CEO of the PFEW has drawn criticism on the basis that other comparable organisations don’t have an equivalent.

Mr Krishna is of the view that “the trend in the industry is certainly changing”, and in any case, he has been appointed to create the more professional organisation desired by the membership.

“What we need to recognise more importantly is the national board has taken this very important decision to hear feedback from the membership and respond to that feedback.”

When asked whether the membership specifically asked for a CEO, he said: “The feedback is that we need to professionalise the way we work…

“The feedback was about we need to bring more clarity in finances, we need to be a true voice, we need to have our standards…and look where it’s landed us when we don’t play to our strengths, so credit to the board who have taken that decision based on feedback and the vast majority see it.”

There are detractors, those who are critical of the CEO role and of Mr Krishna himself.

As a democractic organisation there will always be “different opinions”. That is not an issue, he says. What is problematic is when this distracts from the mission of improvement.

“It’s unfortunate that the narrative that some detractors are fueling is becoming counterproductive…what I have always said is, ‘reach out for a conversation, I’m more than happy to engage’…”

Mr Krishna says people have approached him at roadshows to discuss any and all grievances, leading to productive conversations which have improved relations with the PFEW.

He feels that a few vocal detractors have “taken the opportunity to criticise without exercising the offer to meet”.

This is a source of mild frustration but the CEO is adamant that he won’t do his “business” on social media.

As for criticism over what some view as a refusal to disclose his salary, Mr Krishna says he is committed to doing this “in the appropriate way” as part of the annual reports currently being prepared by auditors.

“I’ve made that commitment, and I’m hopeful that the annual reports will be published this [financial] year…”

It’s fair to say that his tenure to date has been eventful, with the CEO himself describing it as a “pretty fascinating 12 months and a bit”.

As for the end goal, he said: “Ultimately, where we need to get as an organisation is to create a mature, modern, unified, diverse staff association…we are just about to set out our vision for 2028.

“We are about to commence the triannual set of elections at the end of this year, which is a process in itself where we take around 9-10 months to elect 1,200 Federation roles.”

Those elected and in place by the end of summer 2025 will help the PFEW build that vision.

“Our 2028 is all about building a unified Federation, looking at the membership as a whole.”

The CEO has been clear throughout that “actions speak louder than words” when it comes to creating an improved organisation for the membership.

That said, he wants to share this message.

“Speaking to our members directly, I just want to recognise and acknowledge that these are very challenging times, and they are doing incredibly well to keep communities safe.

“We are laser focused as a Federation, as an organisation to rebuild, and to be there for members.”

This article was first published on Police Oracle, 15 October 2024.