Under the provisions of the Marriage (Same Sex Couples) Act 2013 the government was required to conduct a review of survivors' benefits in occupational pension schemes.
The review compared provision of pension benefits between different categories covering: same sex survivor benefits (incorporating both those in civil partnerships and marriages) compared with opposite sex survivor benefits provided to widows; same sex survivor benefits compared to opposite sex survivor benefits provided to widowers; and opposite sex survivor benefits as provided to widows compared with opposite sex survivor benefits as provided to widowers.
Published in June 2014, the review confirms that there will be a significant cost to the public sector of removing differences between the categories assessed. That cost is £2.9 million although around £1 billion of that relates to benefits that are due before 1 April 2015. It is expected that there would then be an ongoing cost of around £0.1 billion per annum into the 2020s reducing thereafter.
The comparative cost to the private sector of removing the differences identified would be around £0.4 billion. If private sector schemes decide or are required to provide benefits to same sex couples on the same basis as opposite sex widows in line with the position under public sector schemes, then this would be at an estimated cost of £0.1 billion.
The review itself runs into 31 pages and is supported by a research paper spanning over 60 pages and the government actuary's department's estimated costs report at 23 pages long.
The ultimate conclusions are not surprising.
The government has already made it clear it supports the idea that married same sex couples and civil partners should be treated equally to married opposite sex couples.
However the cost of full equality for pension schemes given the need to fund and the impact of past but acceptable unequal practices acts as a natural barrier to taking a step towards total equality in this area.
There is clearly concern that whilst the cost may not seem prohibitive to the private sector, the cost to the public sector is not insubstantial and there is not likely to be any appetite to proceed on the basis of equality in the private sector whilst inequality exists/remains in the public sector. Conversely steps to bring the private sector in line with the public sector in this area have a cost on the private sector, but not one that is clearly prohibitive. This would see the removal of the 5 December 2005 cut off date for providing fully equalised benefits and could be a possible first step.
However there is no stated intention or indication in the review of what the government ultimately may decide.
The position therefore remains as before, despite the review and the recent case of Innospec-v-Walker. Specifically, in relation to civil partners and same sex marriages, the 5 December 2005 cut off date, before which equalisation is not required except in relation to contracted-out benefits, remains a valid cut off point.