Public sector unions take government to court over pension reform

Four unions representing millions of UK public sector workers are taking legal action against the government for failing to deliver expected improvements to their pensions.

The unions — representing firefighters, police officers, teachers and other public servants — filed for a judicial review against the Treasury on Friday in the Administrative Court, a division of the High Court.

They say the government is in breach of a rule for public service pension schemes which came into force in April 2015, when retirement benefits for government workers were made less generous.

The rule requires that any benefit from a reduction in the government’s cost of financing the scheme below a pre-determined level is passed on to members.

In September 2018, the government said that initial results from a 2016 scheme valuation indicated that members should get “improved pension benefits for employment over the period April 2019 to March 2023”.

Ministers know full well 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 on to members

There would be consultation on what this would mean for each public sector scheme and changes would be implemented from April 2019, according to the government.

However, in 2019 Liz Truss, chief secretary to the Treasury at the time, announced that implementing the improvements would be “paused” while the government fought a separate legal action that its 2015 pension reforms had discriminated against younger workers.

The government lost this action last year, but scheme members have yet to see the expected improvements to their pensions from the 2016 valuation.

“Less than six months ago we beat the government in court over pensions and their unwillingness to listen to our concerns, and we are ready and willing to do it again to get our members and thousands of public service workers the improvements they are owed,” said Matt Wrack, general secretary of the Fire Brigades Union, which is taking the legal action with the GMB, PCO and PCS unions.

“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 on to members. Refusing to accept this and pausing the process amounts to a dirty trick.”

On Friday, the unions could not provide an estimate of the total value of the improvements that it said members were owed.

But they said the case could affect anyone who joined the pension schemes for those working in local government, civil servants, National Health Service workers, teachers, members of the armed forces, police officers or firefighters on or after April 1, 2012. 

A government spokesperson said it would provide an update “later this year” on the cost control mechanism that assesses the value of public sector pensions, which was paused as a result of last year's court ruling.