Pensions in UK Law

Very many of the expatriate UK pensioners who do not receive uprated pensions have a strong and understandable sense of grievance. They paid their contributions calculated in the same way as pensioners now living here and in, say, the USA, yet they do not receive the same pension. They feel that they have been deprived of an increasingly substantial part of the fruit of their contributions. The real value, at least in the UK, of their pensions is declining from year to year.

There may be such an obvious, relevant difference between the claimant and those with whom he seeks to compare himself that their situations cannot be regarded as analogous. Then the court's scrutiny may best be directed at considering whether the differentiation has a legitimate aim and whether the means chosen to achieve the aim is appropriate and not disproportionate in its adverse impact.

It seems clear from Stec, however, that the normally strict test for justification of sex discrimination in the enjoyment of the Convention rights gives way to the "manifestly without reasonable foundation" test in the context of state benefits. The same principles were applied to the sex discrimination involved in denying widow's pensions to men in Runkee v United Kingdom [2007] 2 FCR 178, para 36.

The need to protect certain classes of pension benefits from the claims of creditors has been recognised by Parliament for at least 130 years. Where it has thought it right to provide such protection, Parliament has enacted that an assignment of the pension rights shall be void.

In the field of what may be called macro-economic policy, certainly including the distribution of public funds upon retirement pensions, the decision-making power of the elected arms of government is all but at its greatest, and the constraining role of the courts, absent a florid violation by government of established legal principles, is correspondingly modest. I conceive this approach to be wholly in line with our responsibilities under the Human Rights Act 1998.

It is generally recognised that pensionable employment is more valuable to a man than the mere amount of his weekly wage. It is more valuable because by reason of the terms of his employment money is being regularly set aside to swell his ultimate pension rights whether on retirement or on disablement. The products of the sums paid into the pension fund are in fact delayed remuneration for his current work.

In the present case the Court of Appeal were in my view right to approve these two decisions and to classify the pension provisions as a continuing act lasting throughout the period of employment and so governed by subsection (7)( b). The matter can be further tested by taking the case of an employer who before the Act was passed paid lower wages to his coloured employees than to his white employees.