CA upholds validity of McCloud costs directions

The Court of Appeal has dismissed an appeal by two trade unions in R (The British Medical Association) v HM Treasury [2024] EWCA Civ 355. This case concerns the Treasury’s statutory power to control changes in the costs of public sector pension schemes by modifying members’ benefits and/or contributions, should the costs to the employers of future pension provision deviate from prescribed targets. The Treasury directed that the costs of remedying discrimination in public sector schemes identified in the McCloud litigation were “member costs” rather than “employer costs”, which meant that members of those schemes would not benefit from the reductions in contributions or increases in benefits that they would otherwise have expected under the relevant valuations of those schemes. The Court of Appeal has upheld the validity of the Treasury’s directions.

The judgment can be found here. A note of the decision will be published on Pensions Barrister shortly.