BT Pension Review
BT Pension Review: BTPS Section C
19 September 2017
BT is going to Court to clarify the Rules of the BT Pension Scheme (BTPS) in relation to the way pensions are increased for pensions in payment for Section C. The hearing is due to take place in the week commencing 4 December 2017.
The decision of the Court may affect the future increases applied to pensions in payment for Section C members. All active, deferred and pensioner members may be affected.
Section C of the BTPS was open for new members between April 1986 and April 2001. In Section C pensions in payment are currently increased using the Retail Price Index (RPI). However, in Sections A and B of the Scheme pension increases are calculated using the Consumer Price Index (CPI). The CPI tends to produce a lower figure than the RPI.
As part of the broader Pension Review BT is looking at changing the use of RPI as the index for calculating increases to pensions in payment in Section C. BT and the BTPS Trustee have agreed to go to Court to decide whether it would be possible to change from the RPI to another index based on the wording of the BTPS Deed and Rules. This is because the Rules can be interpreted in different ways.
BT, the Trustee and all Scheme members will all be bound by the outcome of the case, subject to any appeal.
Given the potential implications of the case, Section C members will be represented in Court. This will be done via a Section C member known as a Representative Beneficiary who will be supported by in independent firm of legal advisors called Stephenson Harwood LLP working with Michael Furness QC.
The Representative Beneficiary’s legal team will argue in Court all the reasons why a change cannot be made to the use of RPI under the Rules.
The Trustee will also be participating fully in the Court process on a neutral basis to assist the Court where necessary and appropriate.
Any potential change to the indexation of pensions is a serious issue and the CWU has met with Stephenson Harwood LLP and the Representative Beneficiary. We are satisfied that they have the independence, experience and resources to ensure that the interests of all Section C members are properly represented.
Further details are contained in the attached letter, which is being sent to all Section C members either by email or by post to home addresses. This includes details of how to contact the Representative Beneficiary.
We will continue to keep members advised of developments. In the meantime, please ensure that you make your views clear about the BT Pension Review to the Branch or email firstname.lastname@example.org