Following the Supreme Court decision in CCC v Sheffield Teaching Hospitals NHS Foundation Trust [2026] UKSC 5, there has been some confusion about how the compensation for pension loss claims should be calculated. In the month after the ruling, Paladin Experts observed several recurring arguments while reviewing Defendant Counter-Schedules disputing pension loss calculations. These disputes reflected a misunderstanding of pension structures and the legal framework used to assess financial loss.
In this article, we will address these misunderstandings, provide guidance on how to apply the Ogden tables in pension loss calculations and establish the importance of correctly modelling pension income to retirement to ensure your clients’ lost years pension claims reflect their entitlement.
Common Misunderstandings about Pension Loss Calculations
During our review of Defendant Counter-Schedules on behalf of the solicitors seeking our advice, the following two arguments arose most frequently:
- Incorrectly asserting that lost contributions could replicate the loss of a pension fund
- Arguing that modelling pension outcomes using investment growth assumptions is “too speculative”
As the Personal Injury Discount Rate is determined using predictions about future investment returns, the suggestion that forward modelling pension outcomes is “too speculative” is inconsistent with the wider framework used to calculate personal injury damages. Assumptions about investment growth are already incorporated into the discount rate, so to argue that the same type of economic modelling is inappropriate when assessing pension loss demonstrates a misunderstanding of how personal injury damages are calculated.
The Supreme Court in CCC v Sheffield went as far as to reaffirm the core approach to assessing financial loss, recommending that an income stream be identified before actuarial multipliers derived from the Ogden Tables are applied to calculate the correct compensation for pension loss. This framework underpins awards for loss of earnings, loss of dependency and lost years pensions claims. When viewed in that context, pension loss should follow the same conceptual structure.
| Head of Loss | Multiplicand | Multiplier |
| Loss of earnings | Net earnings | Ogden 8 earnings multiplier |
| Lost years | Net earnings and pension, less living expenses | Ogden 8 earnings and pension multiplier |
| Loss of dependency | Percentage of net earnings and pension to dependents | Ogden 8 earnings and pension multiplier |
| Pension loss (at retirement methodology) | Net pension income | Ogden 8 pension multiplier |
| Pension loss (lost contributions method) | None | None |
How to Model Lost Years Pension Claims
As the lost contributions methodology only measures pension contributions made during employment and neglects the financial benefit those contributions would generate in retirement, this approach to calculating pension loss compensation is not fit for purpose.
By contrast, modelling pension income to retirement identifies the income that would have been received and then applies the appropriate multiplier. This approach allows pension loss to be assessed consistently across different pension arrangements — including defined benefit schemes, contribution schemes and hybrid arrangements — as well as the different heads of financial loss recognised by the courts, such as loss of dependency and lost years pensions claims.
Pension Loss Support from Paladin Expert
Pensions are an increasingly significant component of high-value claims, particularly where long careers or senior earnings are involved, heightening the need for careful analysis of pension loss methodology. At Paladin Experts, our team of financial advisors will review Schedules of Loss, Counter-Schedules or expert challenges relating to pension calculations and provide independent financial analysis of the issues raised.
For more information about our services or to instruct us in a review of your pension loss compensation calculation, please feel free to get in touch with us today, and we would be happy to assist you.
