£35million win for BALPA members affected by Pension Protection Fund compensation cap
BALPA recently won a major legal victory potentially worth over £35million pounds for 170 of BALPA’s members. Our successful campaign to end the Pension Protection Fund (PPF) compensation cap was launched when ex-BMI and ex-Monarch members were left severely out of pocket when their pension schemes entered the PPF.  
In July 2021, the UK Court of Appeal ruled that the PPF compensation cap is unlawful on grounds of age discrimination. It means the cap has now been removed and affected members are now   entitled to receive 90% of their expected pension under their original DB scheme with no cap applied. 
Without this legal action, many Monarch and BMI pilots would have lost a large portion of their pension savings – in some cases more than 50% – when their companies were sold and their pensions went in to the PPF.
The PPF is now in the process of providing benefit uplifts for affected ex-BMI and ex-Monarch members.   

 BALPA Position

Pilots continue campaign to fight changes to the existing pension tax relief framework
Pilots feel the current pension system – including the existing tax relief framework - works. They want stability and fear any changes could undermine the system and put people off saving for their future.
BALPA believes previous reductions to the annual and lifetime allowances are already putting some higher and additional rate taxpayers off saving. Professionals are reducing their pension savings or pulling out of them altogether, a problem that would be accelerated if the Treasury decide to reduce or abolish higher rate tax relief as was mooted again only last year.  
The immediate policy aim should be to restore stability and rebuild confidence in the existing pensions system by hitting the pause button on any further pension tax changes.

Virtually all BALPA members are now covered by DC pension schemes and we are working to ensure these schemes are improved as many will not deliver an adequate retirement income.

Pilots have worked with other professionals (doctors, dentists, civil servants and senior police officers) to highlight the potential consequences of reducing higher rate tax relief and protect pensions saving (both DB and DC).