Greg Wright: Wait for pension justice continues for Carrington workers

These remarks must strike a chord with the 500 members of the pension scheme at Carrington Wire, who have lost patience with a quango set up to defend their rights.

They have a simple plea: When will the Pensions Regulator complete its investigation into the fate of their pension scheme?

Their concerns are shared by Dan Jarvis, the Labour MP for Barnsley Central, who tried, unsuccessfully, to catch the Speaker’s eye last week so he could quiz the Pensions Minister Steve Webb about Carrington Wire.

According to Mr Jarvis, the uncertainty caused by the Pensions Regulator’s failure to set a date to complete its investigation is causing distress to hard-working Yorkshire people who could lose tens of thousands of pounds, through no fault of their own.

Many lost their jobs when Carrington Wire folded last year, and now they are facing a fraught period as they try to work out if they will have enough cash to fund their retirement.

Mr Jarvis wants the Government to take immediate steps to ensure the Pensions Regulator functions more efficiently.

Let’s recap how the pension scheme members found themselves in this position.

Last year, Carrington Wire, which is based in Elland, West Yorkshire, closed down with the loss of more than 80 jobs. The Russian parent company Severstal, which bought the firm in 2006, said the decision was due to a contraction in the market for steel wire.

Earlier this year, representatives of the former employees at Carrington Wire said they were seeking talks with Severstal to ensure that guarantees were put in place to safeguard payments being made into the company’s defined benefit pension scheme.

In 2010, Craig Whittaker, the Conservative MP for Calder Valley, wrote to the Pensions Regulator, asking it to investigate the position of the Carrington Wire pension scheme, after Carrington Wire was sold out of the Severstal group.

In January, I contacted businessman Richard Williams of Gillico, who took over Carrington Wire in June last year.

Mr Williams said that the company’s operations were run down prior to his takeover. He said that the pension guarantees were a matter between Severstal and the pension trustees.

He stressed that he was not a trustee to the scheme and never had been. Severstal has declined to comment.

The pension fund members hoped things would come to a speedy resolution earlier this year, when Mr Jarvis wrote to Mr Webb to ask why it had taken nine months for the Pensions Regulator to begin an investigation into the transfer of the Carrington Wire pension fund. I understand that the Pensions Regulator disputes this claim.

Mr Jarvis also wanted to know what protections were in place to ensure that pension commitments were honoured in cases like Carrington Wire.

Hanging over this saga, is the prospect of the scheme being placed in the Pension Protection Fund, which pays compensation to members of defined benefit schemes, when the employer becomes insolvent or there are insufficient assets in a pension scheme to cover pension protection fund levels of compensation.

If this happens, some Carrington Wire scheme members believe they could end up with just 70 per cent of their pension.

Last night, a spokesman for the pension scheme members said: “Time is running out for the scheme and we will have to seek admission to the Pension Protection Fund before long.

“If the scheme is placed with the Pension Protection Fund the members will suffer a significantly reduced entitlement.

“We require some political leverage to force the Pensions Regulator to get its collective finger out.”

So what has the Pensions Regulator got to say for itself?

Well, an official spokesman has confirmed that an investigation is ongoing into the fate of the Carrington Wire scheme.

Although the Pensions Regulator understands the members’ concerns, the Pensions Act 2004 places restrictions on how much information can be disclosed, the spokesman said.

I understand that these types of investigations are usually completed in months, rather than years, so there’s some hope of a conclusion soon.

Apparently, the Pensions Regulator doesn’t normally fix dates to compete its investigations because this could limit their scope and make them less exhaustive.

Fair enough. But Mr Jarvis and 500 Yorkshiremen and women still believe this quango is dragging its heels. The final report had better be a thumping good read.