The Pensions Regulator (TPR) has stepped in to investigate the deal being offered to British steelworkers after alerts that thousands of members are being forced to make a decision about their financial future without vital information, FTAdviser understands.
In August, Tata Steel UK (TSUK) got the go-ahead to offload the British Steel Pension Scheme and create a new defined benefit fund.
Some 130,000 members have to choose by 11 December if they want to be transferred to a new scheme being created, BSPS II, or remain in the old defined benefit plan which will be moved to the lifeboat scheme, the Pension Protection Fund (PPF).
However which route will be best will depend on a variety of individual factors.
To make this irreversable decision, pension scheme members have been sent document packs by the pension scheme's trustees which supposedly give them all the information they need about their individual circumstances to make an informed decision.
However, in around 4,300 of these individuals’ packs, there is a lack of data, such as not having an employment starting date, incorrect estimates of the pension value, or even no individual figures at all.
According to a document from the scheme trustees seen by FTAdviser, this affects 4,292 individuals, mainly deferred members.
Stefan Zaitschenko, a former Tata steelworker who helps run a Facebook group for members of the old scheme with 4,300 participants, was told by the regulator that the organisation is receiving a large number of calls from British Steel members.
Mr Zaitschenko said: “They said there is enough for them to be concerned about it and that they are following it up with the BSPS trustees.”
Contacted by FTAdviser, a TPR spokesperson didn’t confirm this information, since the regulator “does not comment on ongoing matters”.
The Pensions Advisory Service (TPAS) is also receiving a number of calls concerning this matter, chief executive Michelle Cracknell confirmed.
She said: “This is normal as it is a big scheme and there is a lot of activity surrounding it. The questions are on a number of issues, not all on the pack.”
In the meantime, BSPS trustees have published a statement in the scheme’s website about the lack of data.
It acknowledges the fact that “some members have no personal figures in their option pack,” and that there are several reasons why this can happen.
It said: “We might not have had all the information in electronic format. In other cases, we didn’t have all the information we needed to calculate figures in time for the option packs […].
“We are working to make sure we have all this information available before the new scheme starts paying benefits and the current scheme moves into the Pension Protection Fund.”
However, there isn’t a simple solution for current members, since the trustee also acknowledge that they cannot send any more figures.
It said: “We won’t be sending you any more figures on top of what is in your option pack, because it’s not possible to do that in the time available.