26 October 2018
Alasdair Mayes, LCP Partner, says: "Trustees and scheme sponsors will not relish having to recalculate benefits going back almost 30 years, but the ruling does give clarity that something needs to be done.
"The scope for Trustees and scheme sponsors to select a methodology that is suitable for them and their scheme is helpful. Careful preparation and analysis will be required to establish which is practical and proportionate before diving into adjusting benefits.
"Several of the methods on the table will involve highly complex and expensive on-going administration, having to maintain two records for each member indefinitely and keep track of past payments.
"The good news is that the Court has left the door open to the methodology LCP (and others) have been working on with DWP involving GMP conversion. Using conversion could deliver significant simplification. It is now essential that DWP and the Treasury remove the practical obstacles to implementation. Without this Trustees could still need to be keeping dual records into the 22nd century!"
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GMP inequalities checklist 2018
Are you considering the implications of the High Court’s judgment in the Lloyds Bank case? Read our checklist, which covers a number of key initial considerations.Discover more