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The Parliamentary ombudsman, Ann Abraham, who investigates claims of government maladministration, has indicated she may be willing to launch an inquiry into its role in the crisis.
If she concludes that government literature misled people into thinking their pension benefits were guaranteed, she could recommend that the government pay out billions of pounds in compensation.
The last time the ombudsman investigated pensions the government was forced to set aside £8 billion for compensation, after it failed to publish changes to state earnings- related pensions.
Up to 60,000 people have lost some or all of their pension benefits because their company wound up a final-salary scheme — either because the firm went bust or it decided to shut down the scheme.
Ros Altmann, a pensions campaigner, will be forwarding a dossier of evidence, which has been given cross-party support by MPs, to the ombudsman this week. It claims to show that the Occupational Pensions Regulatory Authority (Opra) and government departments, especially the Treasury and Department for Work and Pensions (DWP), actively encouraged people to join company pension plans without mentioning the risks.
Altmann has estimated it would take £75m a year over 40 years, or £3 billion, to restore lost pension benefits.
In a separate move, the Community trade union is taking the government to court on behalf of members who have lost out. The initial hearing is expected next month.
Altmann said: “Inaccurate and woolly statements by government agencies incorrectly led members to believe pension contributions were safe in their final-salary schemes. The government must compensate victims of this maladministration in full to right this terrible wrong.”
Official leaflets described company pensions as “guaranteed” or “safe”, and urged people to join them. They also failed to state that you could lose all your benefits if your employer went bust or wound up its scheme.
In 2000 the Institute of Actuaries urged government departments to warn the public about the risk to pensions at wind-up, but they ignored the advice.
For example, the Pension Service, part of the DWP, was still issuing a booklet called Occupational Pensions: Your Guide last year. It stated: “The assets of the pension scheme belong to the scheme, not to your employer. As a scheme member, you are protected by a number of laws designed to make sure schemes are run properly and to make sure funds are used properly.”
Opra, the government’s regulator, also stands accused of issuing misleading statements to pension trustees, who then relayed this information to their members. It overstated protection provided by the minimum-funding requirement (MFR), a solvency test that is supposed to ensure a pension maintains a minimum level of funding.
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