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Last Updated: Friday, 28 October 2005, 12:11 GMT 13:11 UK
London: Pension crisis
Khevyn Limbajee
Khevyn Limbajee
Politics Show London

Money

Peter Humphries is 62 years and works as a part time caretaker. He is not working out of choice but from necessity.

Peter worked for Dexion in Hemel Hempstead just north of London manufacturing shelves.

Peter took voluntary redundancy but did not cash in his pension fund. In hindsight, that was terrible error

Dexion went bust in May 2003.

For 40 years Peter paid into his pension fund, as part of his work contract. When it went bust, he found he had lost most of his pension.

He thought his pension was guaranteed in law. This was not the case.

The pension fund simply did not have enough money to pay for his pension, only those who had already retired were safe

Peter Humphries
Peter Humphries lost his company pension

To make ends meet, Peter has had to start working as a school caretaker in St Albans.

Peter said "I never thought at 62 I would still be doing shift work.

"I paid in 5% of my gross income for nearly 40 years. In all, I have lost probably about 80,000."

There around 85 000 people living in Britain who are in a similar situation and Dexion's pension sheme is one of around 380 other pension schemes which have folded.

With other former employees in similar position, Peter has joined The Pensions Action Group.

They marched in Westminster and even launched a protest at the Labour Party Conference where they went naked behind a banner "Stripped of our pension".

On 14 May 2004 the government announced a rescue fund of 400m.

The Financial Assistance Scheme (FAS) is designed to compensate workers who have been put in situations like Peter.

The scheme will top up the amount to 80% of their final pension, but the pension is capped at 12,500.

This scheme applies to those in company schemes that went into liquidation and pension wind-up between 1997 and April 2005.

And no one gets any money before they are 65 years old.

But because of the stringent criteria the scheme does not cover everyone affected, only around 15,000 people are expected to benefit.

That leaves around 65, 000 who are living in uncertainty about their future.

The Parliamentary Ombudsman is writing a report into this issue and his suggestions should come out by the end of 2005.

Marlene Cheshire
Marlene Cheshire had to lie to her dying husband

Marlene Cheshire is a friend of Peter Humphrey. Her husband, Dave, worked for around 30 years at Dexion.

He reached 60 and could have retired, but the company asked him to carry on working until 62.

When the company went bust he lost his pension.

He died recently and still the FAS money had not come through. Just to reassure him, Marlene told him otherwise.

"I lied to him you see, a couple of hours before he died, because he was stressed out and I just came out and said guess what, we have got our pension just to let him die in peace"

Marlene has still not received a penny.

This has shaken the confidence in pensions for those who have suffered, but the wider question is:

Will this have an impact on whether people take out pensions?

Politics Show

Join Politics Show on BBC One on Sunday 30 October 2005 at Noon with Tim Donovan.

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11 Sep 05 |  Politics Show


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