Unless you are very lucky, your pension benefits have already been slashed by up to 25 per cent. That's because the government this year shifted the goalposts and changed the benchmark for uprating pensions from the retail prices index (RPI) to the consumer prices index (CPI).

The change for public sector pensions, tax credits and state pensions took effect in April. For the uprating of private sector pensions it took effect in January - unless your scheme has rules which specifically link uprating increases to RPI, in which case you escape the switch.

Why does this seemingly innocuous move make such a difference? For the simple reason that CPI nearly always lags RPI - by 0.75 per cent, the Office for Budget Responsibility calculated in 2010 - because of differences in the way the two indices are calculated.

This year the OBR raised its estimate of that difference to 1.2 per cent for future years, with the effect of magnifying the already large savings to the exchequer and to occupational schemes in general.

According to the Department for Work and Pensions' own assessment, the change will save private sector schemes a total £73bn on their scheme balance sheets. That staggering amount makes Gordon Brown's famous ‘raid' on pensions - worth app £5bn a year to the Treasury - look a veritable storm in a teacup.

In addition, according to the Treasury, the move will save government around £6bn in 2014-15 alone on its own pension liabilities.

For active members of schemes, the switch will mean a cut of up to 12 per cent in the value of their pension by 2027, and 20 per cent by 2050 - a permanent transfer of wealth from scheme members to shareholders.

Prospect and other organisations have lodged a judicial review of the government's decision, announced in 2010 without any consultation with pension schemes or their members.

This will be heard in the High Court on October 25-27. A legal challenge is the only hope of reversing the decision since Labour leader Ed Miliband made clear at TUC that he would not commit a future Labour government to rescind the move.

In reply to a question from Prospect president Nigel Titchen at the TUC conference, Miliband said: “I can't promise to reverse RPI-CPI because I don't know where the money would come from to do that.”

This article was first published in the October-November 2011 issue of Profile.