For nearly 30 years we have been scratching our heads over the vexed question of whether guaranteed minimum pensions (GMPs) need to be equalised – and the even more vexed question of how this might be done. At last an end is in sight. Last year, it was reported that the issue was going to be referred to the High Court by Lloyds Bank and its pension schemes following claims from members co-ordinated by the staff union. This week the papers formally starting the legal process, and the questions for consideration, were lodged at the High Court.
The questions the court is being asked to decide are:
Where GMP has been earned after 17 May 1990 (the date of the landmark Barber equalisation case) is there an obligation on the scheme to adjust non-GMP benefits in order that the total benefits received by male and female members with equivalent age, service and earnings histories are equal?
If so, is the equalisation obligation only triggered for a member where he or she can identify a comparator of the opposite sex?
Is there a single correct method to achieve equalisation – and, if so, what is this method?
If there is a choice of method, how do the trustees decide which method to use (whether exercising their statutory power to amend their scheme to reflect sex equality conferred by section 68 of the Equality Act 2010 or their scheme's amendment power)?
The wheels of justice move slowly. Lodging the papers is just the start of the formal part of the process. How quickly the case progresses depends on how much work has already been done in preparing the arguments and exploring the different methodologies for equalisation which will need to be presented to the court – and how many days the case is expected to last.
It would be nice to think that we will have a decision before the end of 2018, but let's not get impatient - we may not quite have reached dry land, but at least we can see our destination on the horizon.