A LEADING pensions expert has attacked the Government's failure to protect staff left high and dry by company insolvency as ex-employees of rebar manufacturer ASW took their fight to the European Court of Justice last week.
Nearly 1,000 ASW employees who lost their pensions when the firm collapsed in 2002 are among thousands more backed by unions Amicus and Community in a long-running bid to claim compensation at a hearing in Luxembourg.
But Dr Ros Altmann, an adviser to the unions, has hit out at the Financial Assistance Scheme set up by the Government to help staff facing a bleak old age. The FAS was introduced in 2004 before legislation securing 90 per cent of pensions under the Pensions Protection Fund.
She said: 'There are around 85,000 people affected by this and the FAS ? which cost about £5 million to set up ? has made payments to just a handful of people so far.
It's a totally unacceptable situation. The Government is guilty of misrepresentation for the sake of positive headlines.' Dr Altmann said that Government claims to guarantee 80 per cent of pensions for those within seven years of retirement are false because FAS payments are not linked to inflation.
According to Dr Altmann, workers are more likely to get 50 per cent of their pension. Payments under the scheme are also capped at £12,000 a year and since its instigation the Department of Work and Pensions has made just 86 payments.
A spokeswoman said: 'The FAS operational unit is working with trustees to support them in providing the data we need to calculate individual payments to eligible members. We are building strong working relationships with trustees and administrators in order to speed up payments.' A spokesman for the ASW delegation in Luxembourg said: 'The misery and despair that has resulted from the collapse of the ASW pension schemes cannot be understated. Houses have been lost, families broken down, widows left to survive in hardship and retirement plans wrecked.' Amicus and Community are arguing that the Government failed in its obligations under the European insolvency directive, which states that member countries have to ensure necessary measures are taken to protect pension rights.