Unions in High Court action on CPI pensions

Unions will open up a legal front tomorrow in their bitter row with the Government over pensions, arguing that a switch in the way increases are calculated are “unfair” to millions of workers.

Six unions are taking action in the High Court to challenge using the consumer price index (CPI) instead of the traditionally higher retail price index (RPI) for the annual increase in public sector pensions.

The move, which came into effect in April, was announced by Chancellor George Osborne in the June 2010 budget, with unions arguing it was done without any consultation or negotiation, purely as a deficit reduction measure.

Unions claimed that because CPI is around 1.2% lower on average than RPI, the loss to existing public sector pensioners will be around 15%, with the change already affecting staff currently paying into career average schemes.

The unions’ case is that the move was not permitted under social security legislation, and that it reneged on assurances given by successive governments that RPI would apply
Read more in The Independent