Statement from Trustees of the BT Pension Scheme, Ford Pension Schemes and Marks and Spencer Pension Scheme

The Trustees of the BT Pension Scheme, Ford Pension Schemes and Marks and Spencer Pension Scheme have been informed that their application for a judicial review of the decision to effectively replace RPI with CPIH from 2030 has been granted.

The hearing is expected to take place in the summer of 2022, when the Trustees will contest the government’s case and defend scheme members and scheme assets from the detrimental effects of a decision which they do not believe have been fully considered.

It is estimated that over 10 million pensioners*, through no fault of their own, will be poorer in retirement either from lower payments or lower transfer values as a result of the effective replacement of RPI with CPIH. Women will suffer the most from this change as they typically live longer.

The reform also significantly reduces the value of RPI-linked assets held to meet pension promises to members, weakening schemes’ funding positions and, in turn, adding pressure on sponsoring employers.

*Estimate from Insight Investment.