The High Court ruled today that the Government’s switch to CPI indexation for public sector pensions is lawful. The National Association of Pension Funds (NAPF) commented on implications for the private sector.
James Walsh, NAPF Senior Policy Adviser, said:
“This ruling means that pension funds in the private sector are not left with further uncertainty around any move to CPI.
“Pension funds already face a complex task in deciding what the rules around switching from RPI to CPI mean for them, and this case could have added more uncertainty.
“Shifting to CPI can give a pension fund some much-needed flexibility, but there are implications for both current and future pensioners. Trustees and employers know that any switch must be handled carefully.
“One in four private sector final salary pensions is able to move from RPI to CPI. Many schemes have RPI ‘hardwired’ into their pension scheme rules.”
Notes to editors:
1. The NAPF is the leading voice of workplace pensions in the UK. We speak for 1,200 pension schemes with some 15 million members and assets of around £800 billion. NAPF members also include over 400 businesses providing essential services to the pensions sector.
Paul Platt, Head of Media and PR, NAPF, 020 7601 1717 or 07917 506 683, [email protected]
Christian Zarro, Press Officer, NAPF, 020 7601 1718 or 07825 171 446, [email protected]