The Coloroll pension scheme has provided a landmark ruling from the European Union's Advocate General which clarifies the equalisation of pension rights between men and women. Pension equalisation threatened to cost British industry up to an estimated pounds 50bn. However, the Advocate General's ruling last year on the Coloroll case made it clear equalisation only applied to pension benefits earned after May 1990.
The problems covered by the Pensions Ombudsman's report disclosed today only relates to the small directors' pension scheme. This only has about 12 members and at its height is believed to have assets of about pounds 1.5m.
However, another Coloroll pension scheme is also in trouble. Former Coloroll employees who worked for a carpet-making subsidiary are believed to face a 30 per cent cut in their pension because of a pounds 3.2m deficit in their scheme. The deficit is partly blamed on a pensions contribution 'holiday' taken in early 1990.
Trustees are suing Noble Lowndes, the scheme's former actuaries, for substantial damages, claiming that the firm relied on misleading data when it allowed Coloroll to suspend contributions.
Noble Lowndes, which was bought last year from TSB Group by Sedgwick, the large insurance broker, has denied the allegation. The firm also acted as actuary to the directors' pension scheme. Coloroll had a total of 15 pension funds.Reuse content