RPI to CPI: court allows switch for both past and future service

By Kate Richards

Over recent years, many employers with defined-benefit (DB) schemes have considered changing the index used for revaluing deferred benefits and increasing pensions in payment. In 2011, the statutory index for revaluation and indexation was changed from the Retail Prices Index (RPI) to the Consumer Prices Index (CPI). It is generally considered that CPI is likely to show lower increases than RPI and so schemes switching from RPI to CPI will be able to record a decrease in liabilities.

The index that should be applied will depend on the detail of the scheme rules. Some rules feed into the statutory provisions and, in which case, will already be using CPI. Others contain rules, or definitions, that give the employer or trustees the power to select an alternative index (sometimes only in specific circumstances). Many schemes will have an entrenched index that can only be changed using the scheme’s power of amendment.

A recent case involving two Arcadia pension schemes shows the court allowing a switch from RPI to CPI, for both past and future service. Although the case turns on the detailed wording of the scheme provisions, it may be helpful to other schemes wishing to make the change…

Click on the link below to read the rest of the Nabarro briefing.

Sign in or Register to continue reading this article

Sign in


It's quick, easy and free!

It takes just 5 minutes to register. Answer a few simple questions and once completed you’ll have instant access.

Register now

Why register to The Lawyer


Industry insight

In-depth, expert analysis into the stories behind the headlines from our leading team of journalists.


Market intelligence

Identify the major players and business opportunities within a particular region through our series of free, special reports.


Email newsletters

Receive your pick of The Lawyer's daily and weekly email newsletters, tailored by practice area, region and job function.

More relevant to you

To continue providing the best analysis, insight and news across the legal market we are collecting some information about who you are, what you do and where you work to improve The Lawyer and make it more relevant to you.

Analysis from The Lawyer

View more analysis from The Lawyer


Lacon House
84 Theobald's Road

Turnover (£m): 116.70
No. of lawyers: 405