Examples of how loss of final salary pension on wind-up has devastated people's lives
Examples of how loss of final salary pension on wind-up has devastated people’s lives
by Dr. Ros Altmann
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CASE STUDIES EXPLAINING HOW PENSION SCHEME WIND-UPS HAVE AFFECTED PEOPLE IN THE UK
1. Mrs. Mackie. – from Dexion scheme – writing about her husband
My husband is a former employee of Dexion Ltd, having worked there for almost 38 years. He made regular monthly payments from his salary into the pension fund for 36 of those years and we were told we would have a secure pension of about £20,000 a year when he retired in three years time at age 60. .The whole fiasco with the pension fund has just about wiped out our pension and our hoped for happy retirement. .He will probably have to work until he dies if the government do not come up with something sensible as a rescue package. It is very likely now that should he ever retire we will not be able to stay in our home. This is doubly sad as we purchased it with my parents 19 year ago as security for my mother, by my invalid father who died last April. He was desperate to ensure she always had a safe and secure home when he was not there to look after her. I dread the thought of forcing her to move at this stage of her life when she believed she was settled and secure which is what my Father had wanted for her. How we have let them both down. Probably the saddest thing is he has actually apologised to me because he feels HE is the one who has let me down. For him to feel responsible for the behaviour of the heartless business men involved in this is awful. He did everything right and nothing wrong at all yet he feels guilty. It makes me so very angry and like him, I feel devastated too. I can truly understand how he must feel. He so loved his job and it made him feel very good about himself. He is dyslexic and always felt he would never amount to much in the world of employment having been written off as a boy by most of his teachers. At Dexion he shone! He knew everything about the products and had designed a large percentage of them. He wrote all the necessary manuals and computer programs, most of the people there knew him as the man to see when a problem came along. Now he feels lost and worthless. Retirement would have been fine because his legacy would have still been at Dexion but now he feels completely lost and alone. The future of the pension terrifies him, he sees no lights at the end of the tunnel and it makes me so very scared for him for the future. We had made a few plans for how to enjoy our retirement before old age set in with a vengeance, but everything seems to have been smashed apart now. I am very worried about him, he really is extremely depressed and very uncommunicative. We do not talk much any more. Sometimes I feel this whole horrible business will wreck our marriage too. I have to deal with all of this Dexion Pension business as my husband is so shell shocked. It is as though everything he has done in the whole of his working life has been wiped away and the last 38 years have accounted for nothing in his eyes. I try to point out to him that we have three great grown up offspring and we are now lucky enough to have one shining beacon of joy in our lives in the form of a delightful new Granddaughter just 6 months old. I spend a lot of time these days writing to anyone I think might be able to offer us a light at the end of the tunnel! I would love to be able to ask Mr. Blair and those in Government what on earth they think we should do now but of course it is not possible to talk with such loft folk, I can not even get him to read the letters I send.
2. Mrs. Eaglestone – wife of Dexion worker
My husband worked at Dexion for 34 years. He was due to retire in September when he reached 62 although he could have retired at age 60 but decided to stay another two years after being told his skills were still needed. If he had had any inkling of the coming situation or the possibility of losing his pension there is no way he would have carried on! We have been told whatever little pension he does get will not be for another three years and it may be less than the State pension he would have had if he had never paid into the Dexion scheme. He has had to try and find work, at 62 that is no easy task. His health has deteriorated over this past year and he does not feel physically able to go back into factory work. He is a very proud man and has worked so hard all his life that it broke my heart to see him stacking shelves in a supermarket for three months. That was only temporary and he has been out of work since the new year although another shelf stacking job may be imminent. I lie awake at night worrying about the future. We still have a mortgage which runs until he is 65 and another option is to sell our house, but to raise any capital we would have to move away to buy a cheaper property and I could not bear to be far away from my family, they are all that keep me going! All our plans have been shattered. We had hoped to spend some money on the house this year but that is now out of the question. We cannot plan any holidays and worst of all we have to think carefully before we can buy anything for our three grandchildren.
I try to be positive and believe as long as we all have our health that is most important buy sometimes it all gets too much and I cry myself to sleep. Update: I have spoken to Audrey and it would appear that they have fallen on hard times financially. Her husband is working permanent nights at Tesco’s shelf filling (He hates it) Audrey works part time at a printers and they live week to week. They have no savings to fall back on. They have not had a holiday for 2 years now and on top of everything else they have been notified that their endowment policy is going to shortfall on their mortgage.
3. Mrs. Eaglestone’s DAUGHTER
This has affected the entire family and we all find it heart breaking to see Dads health deteriorating, whilst he struggles to find work and Mum worries terribly about the future (even though she tries to hide it). I have 2 young daughters and my husband is self employed, so we have our hands full, financially. Even if my parents would allow us to help them, there would be very little we could do. My parents have worked hard all their life and I cannot bear to think that they will not have anything to look forward to in what future they have left. They have done their very best to provide for us, apart from getting into debt ourselves, who will provide for them?
4. Miss Jones. daughter of ASW worker who lost his pension:
I am the daughter of an ASW worker. Like many others my father lost his job last year and is also waiting to hear about his pension (having been a member for 25 years). He is now 61 years old and living on state benefits. This is hardly enough for him and my mother who is unable to work because of ill health. I am currently helping to support them both and am having to consider buying their house to provide enough equity for them to live on into the future. This is not a situation I expected to find myself in at the age of 33. My key message is that this is not an issue limited to a relatively small group of older guys. This can affect whole families. And that at 33 I am having to make up the shortfall and I probably have to do this for the next 20-30 years. Ironically, it will be my own pension provision that I use to support them. The time bomb will certainly shift a generation.
5. Mrs. Allen – wife of Dexion worker
Our plans were that my husband would retire at around age 62 on his Dexion Pension which he had paid into for 28 years and we would spend a considerable time of the year exploring the British Isles and parts of Europe in our very old motorhome and enjoying our hobbies of walking and bird watching and visiting gardens. With the Wind Up of the Pension this means that a) my husband can no longer retire at 62 and b) we will not be able to run a motorhome and a car. We may not even be able to run a car which means that we would be dependent on the virtually non-existent bus service – or in other words tied to our home. But will we indeed be able to remain in our home? What happens when a large electrical item needs replacing? garden fences reach their sell by date and need replacing? carpets need replacing? If we do manage to run a car where does the money come from to pay garage bills? and where does the money come from to purchase a replacement when it’s beyond repair? Do we go begging to our children who have families of their own to bring up? – and of course are worried about their own Pension Schemes. How else will it affect us? Will we be able to afford visits to the theatre and cinema? (but if we can’t afford to run a car how would we get there?) treat the grandchildren at Christmas and Birthdays? treat the same grandchildren (and ourselves) to days out? go out for the occasional meals? enjoy the occasional holiday? Is this too much to expect after paying for 28 years to ensure a reasonable quality of life in retirement? rather than just existing and waiting for the Grim Reaper? We did as the Government advised us, saving towards our retirement and relieving the burden on the State and look where we will be on retirement—- NO PENSION AND CLAIMING FROM THE STATE! SOME ADVICE!! FROM LOOKING FORWARD TO AN ENJOYABLE RETIREMENT WE ARE NOW LOOKING TO THE FUTURE WITH DREAD.
6. Mrs. Banham. – wife of Dexion worker
When my husband came home with the devastating news that he had lost his pension and with it his lump sum after contributing for 38 years, with just 6months to retirement, I felt sick to the stomach. First of all I couldn’t take it in, how can that happen? All our plans, our hopes, our dreams have suddenly been lost, just like that, how can that happen?. For the last few years all we could talk about was when he was retired, what we going to do. The things we were not able to do before retirement. e.g. Explore this country, spend more time together walking, my husband maybe doing more cycling, the things that most people think about in retirement. He could have retired from Dexion in 2001 at the age of 60, but was persuaded to stay on for a further 2 years. Eighteen months down the line he has lost his job, his pension, his dreams of a good life style, one he had earned and paid for. He has changed as a person. He used to be funny, matter of fact, easy going-now he is very “Victor Meldrew’ish”. Quick tempered, very bitter and very miserable at times.
I have resorted to take depression tablets to cope with both him and the situation, something I did not have to do even when I was diagnosed with Breast Cancer. He always said to me that if anything happened to him first, I would always be able to cope, not now and this concerns him. Our daughter is getting married early next year and we no longer in the position to help her towards the wedding as we would have wished. This is making her feel guilty taking anything from us as she is so worried about our future.
He had also saved extra into AVC’s and guess where they were?. You’ve got it in one– “Equitable Life”. He has done everything he could for a decent future and retirement so as not to rely on state benefits, now we have nothing. After being at work since the age of 15, he claimed only one week sick pay in all of that time. He has never been on the dole, until the day he left Dexion. But now we find ourselves living of what savings we had managed to put aside. Sooner or later that is going to run out and we will be dependent on the state. However, we will not give up the fight for compensation, we can’t. We did everything we were asked to do. We paid into a company pension. We bought our own house. We saved for our future. For what?. What more could we have done?. We have been terribly let down.
7. Mr. Carpenter of the Perivan scheme
Mr. Carpenter has lost his entire occupational pension and much of his state earnings related pension too. He contributed to the Perivan pension scheme for 38 years.
Mr. Carpenter is 66 years old and the details of his pension situation are as follows:
| Pension he was supposed to get from Perivan scheme | £86pw |
| Of this, the GMP element was supposed to be | £48pw |
| And the actual company pension element was to be | £38pw |
| Pension he is actually getting from the Perivan scheme | £17.33pw |
| Amount by which his State pension is being reduced | £47.95pw |
In other words, he is getting absolutely no pension from his own contributions to the Perivan scheme and he is losing at least £31 a week, for the rest of his life, because his state entitlement is being reduced and not replaced by the Perivan scheme. The Government encouraged him to contribute to this scheme, told him his money was safe, never mentioned any possible risks and said he would get a ‘Guaranteed Minimum Pension’ – GMP of £48 pw and this has turned out to be neither ‘guaranteed’ nor a ‘minimum’. If he had never joined the Perivan scheme, he could now have an extra £31pw pension, as well as having the benefit of the contributions he put in. Even the letter telling him he is getting £17pw makes it clear that he may have to pay the money back and it is not a final figure (and there will be no inflation indexing.) All scheme members coming up to pension age will be suffering the same fate in coming months and years, as long as compensation is not paid. The Government encouraged people to join these schemes, led them to believe they were safe and never gave any risk warnings.
8. Mr. Tilson of Perivan pension scheme
I am 55 in March and worked for Perivan all my working life. I was made redundant in November 2003 due to the collapse of the firm. All my pension contributions were in the company’s final salary scheme. I am devastated at the thought that I may get very little or none of my pension when I reach retirement. At no time did the trustees ever tell me that the Pension would be in trouble if the company went bust. The thought of having no pension at the end of 36 years contributions is a continuous worry to my wife and I. I have trouble sleeping worrying as to what the future holds. I am finding it difficult to find another job and with no redundancy or severance pay to date is another worry.
The stress and strain of it all weighs very heavy on my family and as we have four children and six grandchildren we now have very little money to spend on them. I contracted asthma 2 years ago and it was said to be work related but the stress of all this has not eased things. I never thought that I would be reduced to protesting in London with a banner – practically begging for something which is actually mine. It makes me so angry that the directors of Perivan, Southend are now running Perivan London and leaving all their debts behind, as if nothing has happened. I just hope that the government will answer our pleas for compensation for I feel all of us that have been caught up in this awful mess (through no fault of our own) should be given back what rightfully is ours. I was always told to look and prepare for the future and have always played by the rules and been a loyal employee only to find that now the rule book has been rewritten. I will fight to the end of this horrible situation and only hope that we succeed – this poem keeps me going
9. Mr. Roberts. of Perivan Pension scheme
I worked for Perivan White Dove which failed in late 2003. I have lost my pension it seems. How is our health being affected by our pension demise? In my case it is becoming extremely difficult to think of anything else. One wakes up in the morning thinking of it and goes to bed thinking of it. It is very hard to get any relief from the worry of it all. You feel utterly depressed by the situation we’re in through no fault of ourselves. My appetite has certainly depreciated over the last months. I feel that I shall very soon have to seek medical advice with regard to taking anti-depressant tablets. It is not only myself that is effected but your nearest and dearest are as well. Lisa, my daughter, has seen a change in my personality. I know she is very worried concerning my health. My daughter has Multiple Sclerosis. so this isn’t doing her any good either.
10. Mrs. Bebbington of the Samuel Jones Pension Scheme
Both my husband and I lost our deferred occupational pensions when our previous employer went into receivership and the companies pension scheme (which we had both been contributing to for 22 years) was wound up. Currently I am self employed running a small B&B and I also do relief work as a carer at the local old people’s home and as a home help covering for sickness and holidays of the full time employees. My husband works as a full time barman at the local hotel on minimum wage. We are both in our 50s, it is too late for us to build up another pension and neither have we the funds to do so. Also, with our previous difficulties, how can we possibly ever trust another pension scheme. We, like thousands of others in our position are hard working people. We did the responsible thing in providing for our old age. We don’t envisage ever being able to retire unless we sell our only real asset which is our home. Could you even contemplate being in our position and if so how would you feel knowing that the taxes you pay are going to subsidise high earners and other people’s pensions but, despite the recent Parliamentary Ombudsman’s damning report, the Government doesn’t see fit to use tax payers (or any other sources of money) to give us our rightful compensation. We personally do not qualify for the FAS and, as our pensions are small and we are a fair way away from retirement, the lack of realistic index linking in the PPF will also give us very little. I look forward to your comments