High Court rules that BBC pension scheme cap is legal

The High Court has ruled that the BBC pension scheme reforms, which cap future pensionable salary increases at 1%, are legal.

The judgement, Bradbury vs. BBC, dealt with an appeal to the decision of the pensions ombudsman in a case brought by John Bradbury, a member of the BBC Philharmonic Orchestra. It was heard before Justice Warren in January, who claimed that the BBC’s change to the definition of pensionable pay was done without consent of the trustees.

The court found that, as long as the BBC acted in good faith, it could apply a 1% limit to pensionable pay to members in all sections of the BBC pension scheme, which includes a defined benefit (DB) scheme and career average pension scheme, which was introduced in 2011.

The court also found that the pensions ombudsman had not considered the separate question of whether the BBC did, in fact, act in good faith. For this reason, it is open to Bradbury to ask for a separate decision on this point.

A BBC spokesperson said: “The BBC welcomes the court’s finding that it can, in principle, apply a limit to pensionable pay in the final salary and career average benefits 2006 sections of the BBC pension scheme, and that this can be done by providing that only part of any pay increase will count as pensionable pay.

“The BBC also welcomes the court’s recognition that the changes made, which include the introduction of a new career average section of the BBC pension scheme and a new money purchase scheme, were options that it offered members to put BBC pension benefits on an affordable and sustainable basis in the future.”

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