Falconer dumps pensions bill to avoid judicial attack

The Lord Chancellor Lord Falconer met the judiciary on Saturday (17 December) to try to hammer out details of judicial pensions after axing the controversial Judicial Pensions Bill.

However, leading counsel at Wilberforce Chambers instructed by the Government and the judiciary in the furore over pensions have not been taken off the case, making legal action still a theoretical possibility.

Falconer made a written statement to Parliament, announcing that the bill was being dropped in favour of fresh proposals that will maintain the value of judges’ pensions. Judicial pensions are now being deregistered from the Finance Act 2004, meaning that they will not be subject to the threatened £1.5m cap on tax-free money in a pensions fund.

The Lawyer exclusively reported (24 October) that some High Court judges were threatening to resign over the bill.

On 7 November it was revealed that senior judges and the Department for Constitutional Affairs (DCA) had instructed leading counsel at Wilberforce as the debate continued.

The new proposals mean that, while the £1.5m cap will not apply, judges will have to pay income tax on pensions contributions. However, upon retirement, a long service award will be payable, reflecting the judge’s grade and years of service.

Falconer said the proposals will “serve to maintain, but not improve, the overall remuneration package for the serving judiciary and to protect the principle of judicial independence in so doing”.