BT To Take Pension Row Back To Court

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BT is still waging war in the courts to change the way pension rights are worked out for thousands of workers.

Despite losing twice in court, the telecoms giant is seeking permission to appeal the decisions.

BT wants to change the inflation factor used to index pension funds against the cost of living increase each year.

Pension payment increases are based on the annual inflation rate reported by the |Retail Price Index (RPI), but BT wants to switch the measure to the Consumer Price Index (CPI).

The CPI is lower than the RPI because the underlying data is drawn from sources that do not include housing costs.

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In December, CPI would give an inflation linked increase of 2%, while RPI would have offered 2.7%, according to the Office for National Statistics.

Appeal requested

BT argued in court that RPI was no longer an accurate measure for calculating pensions.

Trade union Prospect represented thousands of BT workers and claimed the company was trying to cap pension payments by transferring an estimated £2 billion to shareholders.

In a trading statement, BT said: “In its judgement handed down on 19 January 2018 the High Court decided that it is currently not possible to change the index used to calculate pension increases for Section C members of the BTPS (BT pension scheme).

“In November 2018, the High Court ruled against BT in the judicial review proceedings in relation to a decision by HM Treasury concerning public sector pension increases.

“We are seeking permission to appeal both judgments.”

The statement also showed the pension scheme is £5 billion in the red net of tax in the final three months of 2018, rising from £4.5 billion in Q3.

British Steel pension timing was wrong

Meanwhile, an independent review has found British Steel workers were not given enough time to make complicated pension decisions which left some facing financial loss.

The review ordered by The Pensions Regulator followed worries about the tactics of pension advisers looking to move many of the workers out of 120,000 British Steel scheme.

In the end, around 8,000 decided to take a cash lump sum to transfer to another pension.

“Members  had little time to make one of the most complex and significant decisions they will ever have to make,” said the report.

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