Flintshire Council facing extra pension costs of £12m following landmark court ruling

Flintshire Council could be forced to fork out an extra £12m in pension liabilities in the wake of a landmark court ruling, it’s been revealed. ‌​‌‌‌​‌‌‍‌​‌‌‌​‌​‍‌​‌‌‌​‌​

In June, the Supreme Court refused permission for the UK government to contest an earlier ruling that changes to firefighters’ and judges’ pension schemes amounted to age discrimination. ‌​‌‌‌​‌‌‍‌​‌‌‌​‌​‍‌​‌‌‌​‌​

The McCloud judgement was based on alterations to public sector pensions made in 2015, which saw workers close to retirement age allowed to stay under existing and more lucrative pension arrangements. ‌​‌‌‌​‌‌‍‌​‌‌‌​‌​‍‌​‌‌‌​‌​

However, the changes were said to be unfair towards younger employees as it meant they were placed into new and less generous schemes. ‌​‌‌‌​‌‌‍‌​‌‌‌​‌​‍‌​‌‌‌​‌​

Government officials have estimated the ruling will result in around £4bn a year being added to pension liabilities across the UK with the NHS, local government, police and armed forces among the organisations affected. ‌​‌‌‌​‌‌‍‌​‌‌‌​‌​‍‌​‌‌‌​‌​

The impact on Flintshire was disclosed in a report being presented to all 70 councillors on the local authority this week. ‌​‌‌‌​‌‌‍‌​‌‌‌​‌​‍‌​‌‌‌​‌​

In the document, officials said: “In December 2018, the Court of Appeal ruled against the government, concluding that changes made to pension schemes discriminated against a group of public officers on the grounds of age. ‌​‌‌‌​‌‌‍‌​‌‌‌​‌​‍‌​‌‌‌​‌​

“The cost of providing a remedy to affected employees is likely to be significant for public sector pension schemes. ‌​‌‌‌​‌‌‍‌​‌‌‌​‌​‍‌​‌‌‌​‌​

“The financial impact of this legal judgement has been calculated by the council in conjunction with the Clwyd Pension Fund actuary, resulting in an additional liability of £12 million. ‌​‌‌‌​‌‌‍‌​‌‌‌​‌​‍‌​‌‌‌​‌​

“Whilst the judgements were only in relation to fire and judiciary pension schemes, all the main public service schemes implemented some form of transitional protections. ‌​‌‌‌​‌‌‍‌​‌‌‌​‌​‍‌​‌‌‌​‌​

“Higher future employer contributions are expected as a result and it is anticipated that it will take some time to resolve the matter.” ‌​‌‌‌​‌‌‍‌​‌‌‌​‌​‍‌​‌‌‌​‌​

The information was included in the council’s statement of accounts for 2018/19 which councillors will be asked to approve at a meeting at County Hall in Mold tomorrow. ‌​‌‌‌​‌‌‍‌​‌‌‌​‌​‍‌​‌‌‌​‌​

By Liam Randall – Local Democracy Reporter (more here). ‌​‌‌‌​‌‌‍‌​‌‌‌​‌​‍‌​‌‌‌​‌​

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