West Law Report

R (GURUNG) & OTHERS v MOD

Posted in Westlaw Reports by mrkooenglish on August 1, 2008

Queen’s Bench Division (Admin) Ouseley J July 2, 2008

Last Updated: 9:00PM BST 30 Jul 2008

Age discrimination – Army – Pension schemes – Pensionable earnings – Service personnel – Lawfulness of decision not to backdate entire service history of Gurkha soldiers – Art. 14 European Convention on Human Rights 1950

FACTS

The claimant ex-servicemen (G) challenged the lawfulness of a decision by the defendant secretary of state, and subsequent order, to implement a new pension scheme for the Brigade of Gurkhas. G had served in the British armed forces as part of a Gurkha regiment. Upon retirement G, and all Gurkha soldiers were entitled to an army pension, but that pension was less than that which was drawn by other, non-Gurkha, servicemen. The secretary of state justified that disparity on the basis that Gurkha soldiers would retire to Nepal where, by comparison with the United Kingdom, it was cheaper to live. After 1997, the Gurkha contingent of the British armed forces was formally based in the UK and they were given the option of applying for indefinite leave to remain in the UK upon retirement. Consequently, the secretary of state implemented a scheme whereby the Gurkha soldier’s pension would be standardised in line with the UK armed services pension: under that scheme, retiring Ghurkha soldiers were entitled to the higher pension, backdated on a year by year basis till 1997 when they were formally based in the UK. Years of accumulated service before 1997 would be determined actuarially and then transferred to the individual’s entitlement as credit. G sought to challenge the lawfulness of the secretary of state’s distinction in relation to the value of a Gurkha’s service before and after 1997. G submitted that the new scheme was irrational because it did not fulfil the stated aim of equalising the benefits of retiring Gurkhas and those retiring from the rest of the British army. G argued that the only rational solution to the problem which the secretary of state faced when standardising the pensions was to transfer all of a Gurkha’s pension entitlement on a year for year basis without reference to the actuarial value of the accrued pension before 1997. G also argued that the scheme involved indirect age related discrimination in breach of the European Convention on Human Rights 1950 art. 14.

ISSUES

(i) Whether the new scheme was irrational.

(ii) Whether the only rational solution to the problem which the secretary of state faced when standardising the pensions was to transfer all of a Gurkha’s pension entitlement on a year for year basis without reference to the actuarial value of the accrued pension before 1997.

(iii) Whether the scheme involved indirect age related discrimination in breach of the European Convention on Human Rights 1950 art. 14.

HELD (application refused)

(1) The fundamental aim of the standardised pension scheme was to reflect the changes in the Gurkha contingent’s home base and to overhaul the assumption that Gurkhas would retire to Nepal. The purpose of the scheme was clearly to bring the Gurkha pension provision into line with the rest of the British army for the future, and to make provision for the past in a way that reflected those circumstances which over time had necessitated a complete change. To put a stop date on the year for year transfer had not been irrational. 1997 could properly be seen as pivotal for enhancing pension purposes. The date had a rational and clear connection with the problem to be solved by the secretary of state and with the solution chosen. The changes in the home base of the Gurkhas, in the immigration rules in relation to the armed forces and hence the expected place of retirement had a strong connection with that date. A scheme that reflected the years before and after that change in home base was not irrational, R (Purja) v Ministry of Defence [2003] EWCA Civ 1345, [2004] 1 WLR 289 considered. The new scheme was well within the range of responses open to a reasonable decision maker. Further, the fact that the secretary of state’s decision had later been expressed in a statutory instrument reinforced the case that considerable caution was required before holding that the judgments embodied in the order, which involved the balancing of a variety of considerations, economical and political, in solving a difficult problem, were unlawful.

(2) The date chosen for the change to year for year transfer from actuarial valuation was reasonable, and any differences it created between those retiring before that date and those retiring after that date were justified. The difference did not reflect age, but the number of years service based in the Far East or in the UK. If there had been indirect discrimination on the ground of age or other status, it was justified and proportionate.

John Davies QC and Simon Forshaw (instructed by Bolt Burdon Kemp) for the claimants. Rabinder Singh QC and Sam Grodzinski (instructed by Treasury Solicitor) for the defendant.

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