Page 4, 27th March 1992

27th March 1992
Page 4
Page 4, 27th March 1992 — I ALWAYS give the Leeds Permanent Building Society HQ in

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Locations: Leeds


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I ALWAYS give the Leeds Permanent Building Society HQ in

the centre of my constituency a second glance when I pass it to check that it is still there. Perhaps the recent shortening of its name to "The Leeds" reflected the increasing financial insecurities of the 1980s the decade of the Black Monday stock market crash, the international debt threat to the foundation of the banks, and the mortgage repayment crisis.

Financial scandals such as the Guinness trial, the Barlow Clowes affair, the collapse of the Bank of Commerce and Credit International, and more recently the Maxwell

Communications "lost pensions" isssue have all contributed not just to an increase in a feeling of insecurity in the financial system but to a real loss of livelihood and income for thousands of people.

Days before the end of Parliament, the watchdog Social Security Committee published a report The Operation of Pension Funds. It had begun an enquiry in July 1991 to investigate the outcome of the Barber case at the European Court of Justice. which insisted that pension funds give equal treatment to all members retrospectively. But what began as a question of equalisation of pension ages developed into a debate on the whole question of ownership and control of pension fund assets.

The national publicity focussed on the Maxwell pension fund calamity and in particular the "evidence" in the form of silence before the committee of the Maxwell brothers.

The report identifies the central issue: "At the turn of the century politicians and social reformers set themselves the objective of guaranteeing people an income in old age independent of the Poor Law. While many pensioners are still poor, particularly the very elderly who were denied the opportunity of joining an occupational scheme and whose age prevented them from being eligible for SERPS, the record this century is of how this objective has been realised for a growing number and proportion of pensioners. That objective has been realised by the combined provision of state and occupational or personal pensions. What has happened

to the pension funds run by Robert Maxwell raises questions shout the security of the legal framework of occupational pensions which, up until now, have achieved so much for Britain's pensioners."

In Leeds, Maxwell Communications owned two printing companies, Petty's and the educational publishers El Arnolds. All the employees of both were tied into Maxwell Communications works pension scheme. It was part of the condition of employment that some 600 workers at Petty's and over 1000 at EJ Arnolds had to contribute to the scheme from their weekly wages.

In December 1991 it was revealed that the pension fund assets had been lost in the misappropriations from the Mirror Group Newspapers (ISIGN) company. Up to now, the pension payments have been maintained in full to all pensioners in the Maxwell Works scheme.

But on March 6, they all received a press release stating: "The Board of MGN regrets that from the end of June this year it will no longer be responsible for supporting pension payments to those who were not regularly employed in the publication of Mirror Group newspapers."

In practice, that means a mother in her 40's whose husband worked at Petty's and died at 35 leaving her the income of his works pension of £64 a week for her and the children will now lose her income from the end of June. She works part-time in the school dinners' service. The problem is that for social security purposes she is still to be calculated as receiving that pension and so is not entitled to social security benefits or help paying her rent or poll tax. Like thousands of others whose works pension income will now cease, she will be reduced to a level of poverty well below that which even the benefit system recognises.

As the TV and newspapers highlighted the primary personalities in the Maxwell crash, those who are really paying the price of the "lost pension funds" are of no media interest. "Social security problems are always too complex" as one newspaper reporter told me.

John Battle is the Labour candidate in Leeds West

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