UK - The pension fund of the Britannia Building Society has filed a High Court claim against some of its advisers related to allegedly negligent equalisation advice.

The pension fund has taken legal action against the law firm Eversheds, and consultants Mercer and Sedgwick Noble Lowndes - which later merged with Mercer - over advice relating to the equalisation of pension benefits for men and women in 1994.

Exact details of the claim are unclear as it is an ongoing legal issue, however Britannia stressed the action does not reflect anything on the situation of the scheme or its reserves, instead it is "just an incident that we felt we needed to address".

Anthony Arter, head of pensions at Eversheds, said: "Equalisation is an issue that has caused widespread difficulties throughout the pensions industry and we act for a number of clients who are taking action against other advisers. This particular claim is an isolated case, which dates back to 1994, and it has been filed against other parties as well. We do not believe there is any merit in the claim against us."

Mercer also stated that it believes it is "not at fault in this highly unusual case" but added the details of the case remain confidential.

Figures from Britannia's latest annual report for 2008 showed at the end of December 2008 the fair value of defined benefit (DB) assets was £413m (€483.9m), an increase from £407.5m in December 2007, while funded liabilities dropped from £349.5m to £309.6m, resulting in a surplus in the funded status of £103.4m.

This is despite a negative investment return on plan assets of -5.5% over the year, compared to 11.1% in 2007, although the scheme did slightly reduce its equity allocation from 46% to 41%, while bond investments increased from 53% to 58% and other investments remained at a 1% allocation.

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