Government bullying victims of pension wind-ups

by Dr. Ros Altmann

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Department of Work and Pensions threatens pension victims with “unlimited” costs bill in judicial review test case and also wants to bar them from any favourable outcome in the European Court of Justice

Campaigners bringing a judicial review claim on behalf of over 75,000 people who have lost their occupational pensions due to company scheme wind-ups have been threatened with an “unlimited” legal costs bill by the Department of Work and Pensions (DWP). This is the very first time a department’s rejection of an Ombudsman report has been challenged in the courts and whatever the outcome, it will create a significant legal precedent.

The DWP’s long established practice has been to avoid seeking legal costs from unsuccessful litigants (most of whom will be forced to seek welfare benefits) where a point of public importance of this kind is at stake. This Government now appears to have abandoned such principles.

In a letter to the campaigners’ solicitor the DWP says it must safeguard public funds and is therefore unwilling to agree not to pursue the campaigners for the  “unlimited” costs it may spend in defending its decision to reject Parliamentary Ombudsman Ann Abraham’s findings of maladministration.  The campaigners are now fearful that DWP will attempt to bankrupt them if they do not succeed.

In a separate move, the Government is trying to prevent members of winding up pension schemes benefiting from any favourable outcome of the challenge in the European Court of Justice.  Government lawyers have asked the courts to impose a ‘temporal limitation order’ on the case being brought by Amicus and Community unions, so that anyone who is not already registered as a named claimant when a judgment is announced  can be excluded from compensation, if awarded.  (The unions have only registered the names of their members in a handful of schemes - most prominently ASW, but ASW members who do not belong to the union would also be excluded).  This means that over 75,000 people may be left out, even if the Government lose the case in the European Court. 

Ros Altmann said ‘this is yet another underhand attempt to deny justice to the victims of this pension scandal and stitch up some deal behind the scenes for the ‘favoured few’.  The government is currently trying to reform pensions to encourage people to contribute in future.  Who will ever trust pensions again if people who saved all their lives in pensions they were assured were safe and protected by law are treated so badly?’

The Association of Corporate Trustees has sought counsels opinion to try to find a way to protect members of schemes which it is involved in winding up.  Additionally, Bindmans solicitors have been helping individuals from the Pensions Action Group to register their names individually, for  a fee of £50. This government attempt to exclude most of the victims has caused further stress and worry to people who have already suffered the loss of their pensions.
 
Andrew Parr, one of the claimants in the Judicial Review case, from the Pensions Action Group said :

“This is unbelievable. The Ombudsman ruled that Government maladministration caused us to suffer terrible injustices and losses.  Now we have dared to challenge the DWP’s decision to reject her findings it responds by threatening us with an unlimited legal costs bill and exclusion from the European Court case.  If the DWP really believes it is right, it should be happy to have that tested in the courts in the public interest without resorting to bully-boy tactics to deter us.”


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