Pensioners’ legal action against Coalition reaches Court of Appeal

Monday, 20 February 2012

Pensioner groups will today (Monday 20th February) enter the Court of Appeal to challenge the Coalition over its reforms to public sector pensions.

In October 2011, the Civil Service Pensioners’ Alliance (CSPA) joined with a range of other pensioner groups to apply for a Judicial Review of the Coalition’s decision to alter the indexation for the annual up-ratings of pensions, benefits and tax credits, from the Retail Prices Index to the typically-lower Consumer Prices Index.

The fight is now being taken to the Court of Appeal, after one of the three judges dissented from the view of his two fellows during the original appeal at the High Court.

Mike Duggan, General Secretary of the Civil Service Pensioners’ Alliance said:

“Our legal challenge is the direct consequence of the Coalition’s broken promises. Before the last election, both the Conservatives and Liberal Democrats promised pensioners that their accrued rights to increases to their pensions would be secure. They have both reneged on that promise. 

The switch from RPI to CPI will have a devastating effect on the retirement incomes of millions of pensioners across the UK. Moreover, we believe that the Secretary of State has gone beyond his legal authority in selecting CPI as the indexation for pensions up-rating. In our view the legislation makes it clear that indexation should protect the purchasing power of pensions, which the CPI fails to do.  

It is clear that the Government’s motivation for the switch to CPI indexation was to save money rather than, as they claim, to accurately reflect the level of inflation faced by pensioners.  Reducing the value of pensions just to save money is not allowed under the law governing how pensions are increased“

Coalition Broken Promises 

Both the Conservatives and Liberal Democrats have reneged on promises made: 

Conservative: In a letter dated 27 April 2010, Philip Hammond, the then Shadow Chief Secretary to the Treasury said:

“Indexation of pensions in payment is an established part of pensions legislation. The Conservative Party has no plans to change the current index-linking of public sector pensions in payment. We agree with the view that the right to indexation of pensions already accrued is part of the accrued pension rights and those rights will be protected.” 

Liberal Democrat: The then Liberal Democrat Shadow Pensions Minister, and now Pensions Minister, Steve Webb MP said in a letter dated 12 April 2010:

“We are very clear that all accrued rights should be honoured: a pension promise made should be a pension promise kept. Therefore we would not make any changes to pension rights that have already been built up. I have confirmed that I regard accrued index-linked rights as protected.”