On the go: The Supreme Court has denied the government’s application for permission to appeal a Court of Appeal ruling that pension changes discriminated against younger members of the Firefighters' Pension Scheme.
As part of government reforms to all public sector pension schemes, the new 2015 Firefighters’ Pension Scheme was introduced. This replaced the final salary arrangement with a career average revalued earnings scheme.
The Fire Brigades Union argued that transitional arrangements were established to protect older members of the scheme, and that the protection imposed on younger members was unlawful on age, race and sex discrimination grounds.
These transitional arrangements for pensions were ruled discriminatory by the Court of Appeal in December 2018.
The government applied for permission to appeal to the Supreme Court, but this application was refused on Thursday because it did not raise an arguable point of law.
Matt Wrack, general secretary at the FBU, said: “This is a hard-fought victory for the union and more importantly for our members. FBU members took action for what they believed to be right, and today, we have been vindicated. We never gave up on our fight for justice, and we are delighted that our perseverance has paid off.”
This case could have wide-ranging implications. In January, Elizabeth Truss, chief executive to the Treasury, said: "The provisional estimate is that the potential impact of the judgment could cost the equivalent or around £4bn per annum."
The Treasury has been contacted for comment.
Rosalind Connor, partner at ARC Pensions Law, said: “The Court of Appeal ruling on this matter had far-reaching effects for government policy on pensions, and so it was expected that the government would appeal. Without leave to appeal, the government is faced with implementing the ruling.”
She noted that the government had followed what has been common practice in the private sector when closing defined benefit pension funds.
“It is accepted that the effects of pension scheme closure are often hardest on those closest to retirement, who don’t have time to save enough to make up the difference, particularly when leaving a final salary scheme, where the last few years are the most valuable. As a result, many employers have tended to give a 'softer' close to those members closest to retirement, where they continue in the more generous scheme for a period longer than the younger members,” Ms Connor said.
“In this case, the court held that there was not sufficient justification for this softer close, so the government must approach a close in a different way, possibly reversing some significant steps taken to reduce the cost of public sector pensions by moving younger staff out of the final salary schemes,” she added.
