The stakes couldn’t get much bigger. If our landmark legal action, which was covered widely in the national press, is successful then not only will up to 165,000 female members of the Bank’s defined benefit pension schemes be entitled to pension increases but some 5 million women across 2,400 contracted-out pension schemes will also be entitled to increased pension payments. The cost of Guaranteed Minimum Pension (GMP) equalisation will be between £13-£20bn. What’s it all about?
Well, let’s recap. The pensions, in particular the Guaranteed Minimum Pensions (GMPs), of female members of staff increase at a lower rate than the pensions of male pension scheme members. We contend, backed up by advice from a leading QC, that this is discriminatory on the grounds of sex and is unlawful. The discrimination affects female members who:
- Joined any of the Bank’s final salary pension schemes; and
- Joined one of these schemes before 6 April 1997.
Male members of the Bank of Scotland and Birmingham Midshires Pension Schemes could have similar claims because part of their pensions are not guaranteed to increase at all. The pension schemes affected are:
- The Lloyds Bank Pension Scheme No 1 (which includes the Scottish Widows Retirement Benefits Scheme and the C&G Final Salary Pension Scheme)
- The Lloyds Bank Pension Scheme No 2.
- The HBOS Final Salary Pension Scheme (which includes the Bank of Scotland 1976 Pension Scheme, the Halifax Retirement Fund, the Equitable Life Pension and Life Assurance Scheme, the Birmingham Midshires Pension Scheme and the Clerical Medical Staff Superannuation Fund).
What’s It Worth?
TBU’s actuarial adviser has looked at a range of members and estimated that the overall difference in benefits, depending on the calculating method used, could be worth up to £2,000 per female member of staff. If you multiply that by the number of female members – active, pensioner and deferred – of the Bank’s pension schemes then that equates to nearly £300 million excluding the cost of implementing any pension changes
Thousands Join Class Action
Thousands of members have registered to join TBU’s class action lawsuit against the Bank and the Trustee Board. Copies of the letters we sent to the Bank and Trustee Board claiming that female members are the victims of discrimination can be viewed on the Union’s website.