Theft of steelworkers’ pensions

Successful campaigners lose up to half their entitlement, shafted after all by caveats in the small print.

Back in 2002, the Cardiff firm Allied Steel and Wire went bust, leaving about a thousand workers stranded without pensions.

The campaign launched by these workers put pressure on a Labour government in 2004 to introduce the Financial Assistance Scheme (FAS), to be followed a year later by the establishment of the Pension Protection Fund (PPF).

The ASW workers were persuaded to settle under the FAS rules, which they were led to believe would pay them 90 percent of their entitlement. This still represented the theft of 10 percent of the workers’ deferred wages, but was accepted by workers on the basis that 90 percent was better than nothing.

To their dismay, it later turned out in the small print that pension contributions made before April 1997 were not inflation-proofed, reducing some pensions by as much as 50 percent.

Ironically, it was the campaign of these workers (a campaign that has endured for 16 years) that paved the way for the subsequent (marginally improved) 2005 PPF legislation, yet they themselves were left in the ditch, robbed of deferred wages accrued in some cases over a lifetime.

As Woody Guthrie put it:“Some will rob you with a six-gun, and some with a fountain pen.” (Steel pensioners ‘still fighting’ despite campaign win, BBC, 16 September 2018)