RPI to CPI Early Day Motion 1032

hugheskevi

I'm not a lawyer either (though I hope I've been doing a reasonable impression in these posts!) but I foresee difficulty with the part of

No one shall be deprived of his possessions except in the public interest...

There is no public interest to concern us here (the Government have not cited that as a reason for the change).

But, it would have to be shown that the Government have deprived you of a possession. In this case, the possession is a pension linked to RPI.

The counter-argument would be that you have never had possession of a pension linked to RPI (you may have assumed you had, but scheme rules say otherwise) and hence therefore the Government cannot deprive you of it and so the act is not relevant.

If it was accepted that you had a possession which was a pension linked to RPI, then there would be no need to resort to the Human Rights act, as the possession would have already been established and domestic courts would then enforce that property right.

Therefore I think any involvement of Human Rights legislation would have to be to establish whether or not you do in fact have possession of a pension linked to RPI. It is at that point I'd very much welcome any lawyer's input, as I have no idea whether this would be a valid use of Human Rights law.

JohnB47

Thanks for clarifying.

Edit: opps didn't realise we'd moved on to a new page. I meant thanks for clarifying, hugheskevi, in post No 60.

JohnB47

Just spotted a reference to an article in the Telegraph online about this. I can't post a link but if you go to the Telegraph website and search for "Pensioners unite to fight switch from RPI to CPI" you'll find it I'm sure.

JamesU

JohnB47 wrote: »

Just spotted a reference to an article in the Telegraph online about this. I can't post a link but if you go to the Telegraph website and search for "Pensioners unite to fight switch from RPI to CPI" you'll find it I'm sure.

http://www.telegraph.co.uk/finance/personalfinance/pensions/8161409/Pensioners-unite-to-fight-switch-from-RPI-to-CPI.html

Ripoff_2

hugheskevi wrote: »

I'm not a lawyer either (though I hope I've been doing a reasonable impression in these posts!) but I foresee difficulty with the part of



There is no public interest to concern us here (the Government have not cited that as a reason for the change).

But, it would have to be shown that the Government have deprived you of a possession. In this case, the possession is a pension linked to RPI.

The counter-argument would be that you have never had possession of a pension linked to RPI (you may have assumed you had, but scheme rules say otherwise) and hence therefore the Government cannot deprive you of it and so the act is not relevant.

If it was accepted that you had a possession which was a pension linked to RPI, then there would be no need to resort to the Human Rights act, as the possession would have already been established and domestic courts would then enforce that property right.

Therefore I think any involvement of Human Rights legislation would have to be to establish whether or not you do in fact have possession of a pension linked to RPI. It is at that point I'd very much welcome any lawyer's input, as I have no idea whether this would be a valid use of Human Rights law.

The CSPA (Civil Service Pensioners Alliance) at cspa.co.uk
seem to believe there is a case to answer and they say they are consulting their lawyers but I like you are now out of my comfort zone on the legal issue. I was hoping that someone on this forum either has or knows a lawyer friend who may be able to give some free legal advice. Being pensioners we can't afford to take individual cases to court but collectively, if we have the heads up that there is a case to answer then maybe we could use the various pension groups to set in motion a legal fight.

However, it may end up with the young students and old pensioners protesting together? Now that would be a first!

Ripoff_2

EDM 1032 count rising, 35 MP's have of today signed the motion, this is quite good by EDM standards but we need many more. So please write to your MP and ask them to sign, it's not a waste of time because it gets the message across. If you want to find out who has already signed the motion then the link is at:

edmi.parliament.uk/EDMi/EDMDetails.aspx?EDMID=42021&SESSION=905

So far, by party, the numbers are as follows: LAB = 23 LD = 4 CON = 0 Others = 8

Keep asking your friends and family and anyone that will listen to write or Email their MP and ask them politely to sign EDM 1032. Thanks

ds9074

This needs to be considered in terms of the national interest not just the vested interests of those who may lose financially.

We have a long term demographic issue in terms of an aging population. We have a large baby boom generation now going into retirement and then a baby boom 'echo' to follow.

The Office of Budget Responsibility in their recent Autumn report published a graph looking at the long term impact on the public finances of this demographic issue and over the long term, way beyond the term of this Parliament and dealing with the immediate deficit issue, it puts severe strain on the government budget.

There is a limit to how much the public will tolerate extra taxation or restraint in spending elsewhere to fund public sector pensions and there are definite limits to how much the government can borrow to fund these committments. Public sector pensions therefore need to be put on a more sustainable path and it is in the national interest to do that. If changing from RPI to CPI helps to do that its a good thing. Far better than a government in 20 or 30 years time having to make much deeper and more controversal cuts to an unreformed system that by then is bankrupt.

Even with the change, because of the level of employer contributions, the public sector schemes will still be good value.

As for private companies - again it is not in the national interest to see a company like BT saddled with committments it cannot meet long term. If BT has committments for legacy reasons which its rivals do not the situation could eventually become untenable for the company as they would have limited capacity to pass these costs on to consumers. The cost to the public purse from extra benefits could be significant if BTs pension scheme eventually defaulted on its committments or the pension protection scheme was overwealmed. Better to get these pension schemes on to a sustainable footing now while there is time.

As to the legality, I am not a lawyer but unless the government is breaking some kind of external international committment (such as ECHR or EU law) then surely it can legislate away any current legal hurdles to changing from CPI to RPI? Parliament is sovereign so can it not repeal any existing law that might prevent this? The courts cannot strike down an Act of Parliament as far as I am aware??

Andy_L

ds9074 wrote: »

As to the legality, I am not a lawyer but unless the government is breaking some kind of external international committment (such as ECHR or EU law) then surely it can legislate away any current legal hurdles to changing from CPI to RPI? Parliament is sovereign so can it not repeal any existing law that might prevent this? The courts cannot strike down an Act of Parliament as far as I am aware??

For occupational pensions its an issue of contract law rather than statute.
AIUI they could "change the law to let them break the law" however that then sets the precident that the gov can(will) breach any contract and so destroys their "credit rating" and thus, eg, any future contracts are priced higher to reflect the risk of default and they have to accept a lower price for government bonds

Ripoff_2

ds9074 wrote: »

This needs to be considered in terms of the national interest not just the vested interests of those who may lose financially.

We have a long term demographic issue in terms of an aging population. We have a large baby boom generation now going into retirement and then a baby boom 'echo' to follow.

The Office of Budget Responsibility in their recent Autumn report published a graph looking at the long term impact on the public finances of this demographic issue and over the long term, way beyond the term of this Parliament and dealing with the immediate deficit issue, it puts severe strain on the government budget.

There is a limit to how much the public will tolerate extra taxation or restraint in spending elsewhere to fund public sector pensions and there are definite limits to how much the government can borrow to fund these committments. Public sector pensions therefore need to be put on a more sustainable path and it is in the national interest to do that. If changing from RPI to CPI helps to do that its a good thing. Far better than a government in 20 or 30 years time having to make much deeper and more controversal cuts to an unreformed system that by then is bankrupt.

Even with the change, because of the level of employer contributions, the public sector schemes will still be good value.

As for private companies - again it is not in the national interest to see a company like BT saddled with committments it cannot meet long term. If BT has committments for legacy reasons which its rivals do not the situation could eventually become untenable for the company as they would have limited capacity to pass these costs on to consumers. The cost to the public purse from extra benefits could be significant if BTs pension scheme eventually defaulted on its committments or the pension protection scheme was overwealmed. Better to get these pension schemes on to a sustainable footing now while there is time.

As to the legality, I am not a lawyer but unless the government is breaking some kind of external international committment (such as ECHR or EU law) then surely it can legislate away any current legal hurdles to changing from CPI to RPI? Parliament is sovereign so can it not repeal any existing law that might prevent this? The courts cannot strike down an Act of Parliament as far as I am aware??

I would just like to clear up one point you may not realise regarding the BT pension scheme. In April 2009, the employees voted to change the BT pension scheme to make it sustainable in the long term. They voted to increase the retirement age from 60 to 65 and they voted to pay a bigger percentage into the scheme up to 8.5% and they voted to change the scheme from a final salary to a career average and they were told that this measure would secure the BTPS scheme with no further changes required.

Hence why BT people are very angry at this RPI to CPI change, they had already made the sacriface you speak of so BT would not fail, therefore what you assert is not actually true. You are asking them to make further sacrifices and lose even more of their pension, that incidentally they have paid for but if you didn't realise the full extent of the changes that have already taken place then I understand why.

For that matter I believe that many public sector workers have already agreed revised pension terms, and already made some sacrifices?

exil

I think most public sector workers accept that some change is necessary in respect of future service due to the well known factors of increased life expectancy and the long term difficulties over funding from taxation. However the issue is that the principle that the Coalition has announced relating to public sector pension reform is that the value of pensions "earned" via past service is to be preserved - and a change from RPI to CPI is manifestly a breach of that principle. Of course - they can do it - they can, if they wish, abolish public sector pensions or the state pension merely by passing the required legislation.