Defined Benefit  

Fresh concerns over steelworker pension transfers

Fresh concerns over steelworker pension transfers

Stephen Kinnock, MP for Aberavon, is attending a public meeting in Wales to discuss fresh concerns about steelworkers' pension transfers.

The event - which will occur at the Twelve Knights Hotel in Margam, Port Talbot on Friday (February 1) at 15.30 - is open primarily to former members of the British Steel Pension Scheme (BSPS), but all defined benefit (DB) pension transferees are welcome.

Mr Kinnock said he was increasingly concerned about bad advice from other advisers besides Active Wealth, the firm that entered liquidation last February following intervention from the Financial Conduct Authority (FCA).

Active Wealth was one of 10 firms which stopped giving transfer advice after they were identified as key players advising members of the BSPS to transfer out.

In a statement yesterday (January 29) Mr Kinnock said: "The fact that some financial advisers feel they can exploit hard-working steelworkers and their families is bad enough.

"But when the FCA knows that bad practice has taken place and does not address it by informing the steelworkers that their pension transfer specialist has had their permissions removed, and that they may like to get their advice checked before it’s too late, then it’s time for the community, once more, to speak up."

Mr Kinnock said other advisers and other professional organisations such as investment companies and self-invested personal pension (Sipp) providers "must no longer be able to look the other way and adopt a ‘see no evil’, ‘ask no questions, tell no lies’ approach, as long as the money continues to roll in".

The meeting will also be attended by Alastair Rush, principal at Echelon Wealthcare, who has been assisting steelworkers who were advised by Active Wealth, Philippa Hann, solicitor at Clarke Willmott, who represents some of these individuals, and Rory Percival, former FCA technical specialist.

Mr Rush said: "We always suspected that Active Wealth activities were the tip of the iceberg. The steelworkers I have spoken to were of the belief that, if they did not transferred out, they were in danger of losing their entire pension.

"These men did not transfer out because they were greedy and wanted to make a lot of money, they were terrified that they would lose everything that they had worked for.

"And in a vacuum of information created by trustees who simply weren't able to react properly, panic ensued. This panic was capitalised upon by Active Wealth and I fear others who appear to have acted in the most appalling manner."

Last week, the Financial Services Compensation Scheme (FSCS) announced BSPS members won’t receive a reduced discount rate for compensation calculations in claims relating to liquidated advice firm Active Wealth.

In the meantime, Frank Field, chairman of the Work and Pensions select committee, has urged the FSCS to reassess its position, saying steelworkers were "failed by the official regulators".