Four public services unions have taken the government to court over pension benefits.
The Fire Brigades Union (FBU), supported by the prison staff union (POA), public services union PCS and general union the GMB, has filed court proceedings because they say the government is in breach of a key part of the new public service pension schemes that came into force in April 2015.
Union officials argued that the cost of the pension schemes for this group of workers has fallen but scheme members did not receive the benefits. Members of the scheme were paying 2% per month more than they should be.
The outcome of the case could affect anyone who joined the pension schemes for those working in local government, civil servants, NHS, teachers, armed forces, police, or firefighters on or after 1 April 2012.
The schemes are valued every four years and if these show the cost to the government has increased or dropped beyond a predetermined level, then the employee benefits should be reduced or improved accordingly under the law brought in by the coalition government.
The latest valuation in 2016 revealed that the costs of the scheme had fallen below this level and that from April 2019, the benefits for thousands of scheme members should have been improved.
However, the then chief secretary to the Treasury, Liz Truss, announced in January 2019 that the process of implementing these improved benefits would be “paused” until the government digested the consequences of an earlier age discrimination case, since confirmed by employment tribunal, brought by firefighter members of the pre-April 2015 schemes, which the government had lost.
The FBU described the delay as a “dirty trick” which sought to pass on the cost of a number of unlawful discrimination cases, including that brought by the FBU, onto members of the new 2015 scheme.
A unionofficial told Personnel Today: “We tried to negotiate with them and wrote to them three times, but nothing was done. So we had to put in the claim. We gave them a chance to sort this out of court.”
By incorporating these extra costs, said the FBU, the government could try to claim that the cost of the scheme had risen above pre-determined levels, thus reducing employee benefits.
The legal claim today is an attempt to force the government to lift the pause and improve employee benefits in line with their own regulations.
Should the unions win the case, the legislation says that members would be eligible for a choice between contribution reductions, benefit improvements, or a mixture of both.
Matt Wrack, FBU general secretary, said: “Ministers know full well that they are in breach of the regulations which clearly state that if the cost of financing the scheme drops, then the benefits should be passed onto members.
“Refusing to accept this and pausing the process amounts to a dirty trick which now means many of those in the scheme will have had their improvements withheld for over a year – worst still is that this robbery has been carried out by millionaire ministers.”
PCS general secretary Mark Serwotka said: “Today we are attempting to reverse the great pensions robbery that our members are being forced to endure.
“The skulduggery from ministers must end and we will pursue all legal avenues to get pensions justice for our members.”
This case was filed yesterday (Friday 24 April 2020) at the High Court. The opponent is the Treasury and the Home Secretary.