The Pension Fund Office wrote to all members announcing
that there was agreement between the Committee of Management (Trustees
of the Imperial Tobacco Pension Fund), the Management Committee of the
Retirement Benefit Scheme (Trustees of the RBS), for a radical change to
the relationship between the Company's two pension schemes. The minnow
was about to consume the whale. This proposed change was a merger
whereby, the much smaller and poorer Retirement Benefit Scheme was to
absorb the larger and richer Imperial Tobacco Pension Fund. This merger
had been agreed by the ITPF Trustees. The carrot was "increased annual
inflationary increases from 'up to 5%' to 'up to 10%'. The cost: a
permanent reduction in existing annual pensions paid ranging from 10% to
2% dependant on age. Members over 80 years of age and Active Members
would not be penalised. All Members had until the 31st October 1990 to
reply.THE LEGAL BATTLE
The Trustees subsequently then embarked upon a programme of nationwide
"Road Shows" to sell the idea to pensioners. Resistance to the merger
was met in every corner of the country and letters poured into the
Pension Fund Office. The fight was on!
Nottingham based Geoff Campion, Bill Garton, Bert Barks and all others
in IMPAC, decided actively to oppose the Company's proposal and set
about organising the legal battle. IMPAC became more formalised with a
committee of 12 and the setting up of a fighting fund. At the same time
pensioners in Bristol, realising the injustice of the proposal, got
together with the same intention. The Bristol Imperial Pensioners' Group
(BIPG) was formed. Both groups acted in a loose informal way with one
single objective: to legally force the Company to abandon its merger
plans. IMPAC, however, had the advantage of an earlier start and set the
pace by contracting an actuary, Bryn Davies, to analyse the financial
state of the Fund and, by an enormous stroke of luck, found a solicitor
by the name of Giles Orton, at the Derby offices of Evershed Wells &
Hind. In the weeks to follow, he was to prove himself invaluable. Again
the Daily Telegraph took the lead on the action being taken. They were
inevitably followed by other broad sheet newspapers. IMPAC held many
meetings with Pensioners, usually at the Commodore, as it was then, at
Aspley, hosting many professional speakers on the platform.
Despite the obvious depth of feeling, Imperial Tobacco Limited were
however determined to push the merger through giving a deadline of 'pay
up and join or take your chances' to all relevant Pensioners. Legal
action by IMPAC was the only opening left.
Now well organised IMPAC's first task was to find a volunteer defendant
pensioner. This was a high risk position since legal costs could be very
high and IMPAC's fighting fund had some cash plus many promissory notes.
Eventually IMPAC Committee member Alan Jenkins put his neck on the block
as Defendant on behalf of Pensioners and Deferred Pensioners. The
Plaintiffs were the then Imperial Group Pension Trust Limited, Imperial
Group Pensions Investments Limited and the then Committee of Management.
After much hard work and a certain amount of luck plus the support of
several professionals, the case went to the High Court on 22nd October
1990. Armed with the support of many well-wishers, including Jack Jones
of the TUC, IMPAC representatives, accompanying Alan, set off to London,
several being interviewed for ITV at the Midland station on departure
and outside the High Courts in London.
Following a brilliant performance by IMPAC's QC, Mr. Patrick Howell and
the final summing up by the judge, the Vice-chancellor Sir Nicholas
Browne-Wilkinson, the High Court found against the Plaintiffs with costs
awarded to the Defendants, Alan Jenkins (Pensioners) and Imperial
Tobacco Ltd. (employees).
The final irony was that the Pension Fund Trustees agreed to the Fund
footing the legal bill for both parties. In effect it cost the Company
nothing; only loss of face.
Pension Fund Members had not only paid for the defence of their fund,
but the attack upon it.
The Committee of Management put back the deadline to 9th November 1990,
whilst guidance of the court was given on 25th October 1990, thus
leading to the collapse of the merger mechanism.
The threat of permanently reduced pensions to many pensioners was
therefore removed, but the merger of the RBS with the ITPF eventually
went ahead.