Protest as pensions battle begins

Masks of Cameron, Clegg and OsborneScores of angry workers have gathered outside the High Court in London as unions opened a legal front in a battle with the Government over pensions.

Union leaders say a switch in the way annual pension increases are calculated is "unfair" to millions of workers.
Several unions are taking action - at a hearing before three judges in London due to last three days - contesting the use of the consumer price index (CPI) instead of the traditionally higher retail price index (RPI).

The move, which came into effect in April, was announced by Conservative Chancellor George Osborne in the June 2010 budget. Unions say it was done, without consultation or negotiation, as a deficit reduction measure.
They say that because the CPI is around 1.2% lower on average than the RPI, the loss to existing public sector pensioners will be around 15% - with the change already affecting staff paying into career average schemes.

The unions' case is that the move was not permitted under social security legislation and that it reneged on assurances given by successive governments that RPI would apply.

Members of a host of unions staged a demonstration outside the High Court prior to the start of the hearing. "We think we have a good chance of success," said a Unison spokeswoman. "We've had a lot of support this morning."

FBU general secretary Matt Wrack said Government actions were "unfair". He added: "This is a vicious attack on existing and future pensioners that could cost them tens of thousands of pounds. Pensioners are being forced to bear an unfair burden for the financial crisis caused by the banks."

A Treasury spokesman said: "Public service pensions will continue to provide protection against inflation and will remain among the very best available, providing a guaranteed pension level for all employees.

"CPI is already used by the Bank of England to set its inflation target and unlike RPI is designed to take account of the fact that consumers tend to shop around, switching to cheaper alternatives when prices for similar goods change."

© 2011 Press Association
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