Rate change amendments did not breach subsisting rights or accrued benefits – The case study of Mr R

Mr R argued that Jaguar Land Rover Trustees Limited cannot make changes to his accrued pension without his consent as these form part of his subsisting rights. He claimed the amended method of revaluation resulted in a reduction to his accrued benefits.

Mr R is an active member of Land Rover Pension Scheme. On 6 April 2017, the Scheme was amended so benefits would accrue on a Career Average Revalued Earnings basis rather than on a final salary basis. 

For active members, pre-6 April 2017 accrued benefits are increased by the consumer prices index, plus 0.5% capped at 2.5%. 

The pre-6 April 2017 deferred benefits of members who had left pensionable service would be increased each year by 5%, or the retail prices index (RPI) if less, in respect of pensionable service up to 5 April 2009, and by 2.5% or RPI if less, from 6 April 2009. 

The complaint was not upheld.

The Ombudsman concluded that the revaluation of deferred benefits in this case was not a subsisting right, nor did it form part of the subsisting rights of a member who was in active membership immediately before 6 April 2017. In any case, the rate of revaluation in deferment was not altered by the 2017 amendments. 

Related determinations

• Land Rover Pension Scheme (PO-19569)