Important equality challenges to public sector pension cuts 



In 2011, the government accepted a range of recommendations to cut public sector pensions made by the Independent Public Service Pensions Commission (the Hutton review) and enacted in the Public Services Pensions Act 2013. The most significant changes were:



• for existing pensions to move from final-salary to career-average; and



• to link pension ages to the state pension age (except for firefighters, police and the armed forces, where the pension age was raised to 60, “subject to regular review”). 



To cushion the impact on those closest to retirement, the government put in place transitional arrangements, fully protecting anyone within 10 years of retirement and partially protecting anyone within 15 years. Younger workers were left to bear the full brunt of the changes. 



Two separate tribunal claims are challenging these transitional arrangements, on behalf of two different groups — judges and firefighters. In December 2018, these claims were upheld by the Court of Appeal. In both cases, the disadvantaged groups included not only the youngest workers (direct age discrimination) but also a disproportionate number of black and minority ethnic (BAME) and female workers, reflecting changes to the composition of both the judiciary and the fire service over the last ten years, and leading to indirect race and sex discrimination. 


Firefighters 


In Secretary of State for the Home Department & Others v Sargeant & Others [2018] EWCA Civ 2844, 5,000 firefighters are challenging the transitional provisions, supported by their union, the FBU. The new retirement age is a particular concern for firefighters because of the physical demands of the role. There is evidence that many firefighters will struggle to maintain necessary fitness levels until 60. Younger firefighters have lost out very significantly as a result of the pension changes. They would need to invest an astonishing £16,000 to £19,000 a year to achieve the same benefits as those delivered by the old scheme, on a basic salary before tax of just under £30,000. 



In a ruling welcomed by the union, the Court of Appeal (CA) dismissed the government’s case, concluding that the government had provided no evidence to justify either its aims or means, instead, relying on generalised and unproven assertions. 


Judges


The judges’ claim was heard alongside that of the firefighters (Lord Chancellor and Ministry of Justice v McCloud & Mostyn [2018] EWCA Civ 2844). Like the firefighters, the judges won their case. In this case, the age and service profile of the judiciary meant that 85% of judges (the older cohort) escaped any cut to their pensions at all, whereas a far smaller group of younger judges (which included the female and BAME judges) were forced to accept less favourable pension terms. The CA could see no rational basis for choosing a policy that went out of its way to improve the position of those judges who had already benefited the most. 


A key political aim for the government in its pension reforms had been to negotiate on the basis of consistency, by applying the transitional provisions uniformly across the public sector with no exceptions. The CA accepted that consistency can be a legitimate aim but said that the judges’ pension situation was so out of line with that of other affected public service workers that it could not be a legitimate aim in their case. 


An appeal to the Supreme Court is expected. 


www.bailii.org/ew/cases/EWCA/Civ/2018/2844.html