Firefighters, teachers, prison officers and other public sector workers are bringing a legal challenge against the Government over changes made to pensions that came into effect in April.
Six public sector unions have claimed that the recent change that involves using the consumer price index (CPI) instead of the traditionally higher retail price index (RPI) to calculate increases in pensions is unlawful.
The trade unions, which include the Fire Brigades Union, the National Association of Schoolmasters/Union of Women Teachers (NASUWT), the Prison Officers Association, the Public and Commercial Services Union (PCS), Unison and Unite, claim that the changes will result in losses of 15 per cent to existing public-sector pensions.
Although the pension reform was first announced in Chancellor George Osborne’s Budget in 2010, the unions claim that they were not consulted and that it was not legally valid under social security legislation.
Matt Wrack from the FBU said: “The Government actions are unfair and, we believe, unlawful. This is a vicious attack on existing and future pensioners that could cost them tens of thousands of pounds.”
If the High Court case is successful, it could pave the way for private-sector workers who will also be affected by the change to bring claims against their pension providers.
Accountants have estimated that the change will mean that savers from both the public and private sectors will lose around £250 million over the next 40 years.
Len McCluskey of Unite said: “Our legal challenge against the coalition Government is hugely significant for workers in both the public and private sectors. Public sector workers face an opportunistic attack on their pensions by this Government, but many workers in the private sector have also been affected.
“We know that some private sector employers are already attempting to move to the lower inflation index, citing the Government’s example. In reality this Government wants us all to work for longer and for less.”
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