Commentary: A narrow legal point on pensions

Britain's unequal state pension scheme, which makes men work five years longer than women to obtain the same benefits, seemed to receive a stamp of approval from the European Court of Justice yesterday. On the face of it, this goes against everything else the court has said for years.

But yesterday's decision related specifically to state pensions and followed consideration of a narrow legal point - whether it was permissible to ask men to pay National Insurance for longer than women in order to receive a full pension. The court case was brought by the Equal Opportunities Commission as part of its campaign to force the Government to allow men and women to draw full state pensions at the same age. The Government has now committed itself to doing so.

Companies must still look to the earlier judgment in the Barber v Guardian Royal Exchange case, and that is not affected by yesterday's news. Companies will have to continue their moves towards equalising pension ages. They can expect no let-up in the EOC campaign - now involving further European court action - against the decision many employers have taken to equalise by making their female employees retire up to five years later than under pre-Barber rules.

Yesterday's decision may help the Government implement its plans for an equal state pension age. If the decision had gone against it, there could have been a big bill to compensate men for over-paid National Insurance contributions. Now it is in a better position to avoid the cheapest equalisation option - state pensions for men and women at 65.