Pensions Action Group

Dr Ros Altmann
24th July 2007

Demonstration for democracy at 9.30am outside Court of Appeal

The Court of Appeal will hear tomorrow (25th July) just how Labour Ministers believe UK democracy should work.  Their barrister will argue that Ministers must have ultimate power over their own Ombudsman, Parliamentary Select Committees and the Courts!

The Secretary of State's case against the victims, who had their pensions legally taken away from them after a lifetime of saving, is that Ministers do not need to listen to the Parliamentary Ombudsman, or the Courts, but are answerable only to their own MPs.  If the Secretary of State decrees that his Department did nothing wrong (even at a time many years ago when that particular Minister was not even around) then everybody must accept his own verdict and those who have been wronged by his Department's actions are not entitled to any compensation at all. 

In a breathtaking display of political arrogance, the Government's lawyers will spell out their contempt for the Parliamentary Ombudsman and her investigation.  The Ombudsman is being forced to defend herself against an unprecedented attack on her position.  Her lawyers will be asking the Court of Appeal what the point of her office would be if Ministers can, without even knowing the facts, simply decide that they are right and she is wrong.  The Government's case is that the Ombudsman has been irrational and so has the High Court judge, when finding that Ministers misled innocent citizens into contributing to company pension schemes, by telling them their money was safe when it wasn't.  Every independent investigation into this scandal has laid the blame squarely at the Government's door, yet still the victims have not been rescued. 

Some of them will be demonstrating to highlight their plight, outside the Court of Appeal tomorrow at 9.30am.  Photo opportunities and interviews will be available.  These poor people will once again be having to travel from all over the country, at their own expense, often losing a day's pay, to beg for justice.  It is quite incredible that this could be happening in 21st Century Britain - and under a Labour Government.

During this Appeal case, from 25th to 27th July, the Government will be asking the Court of Appeal to rule that Ministers can be judge and jury in their own cause and that even if everyone else says the Government has behaved wrongly, Ministers can legally over-ride them. 

I believe that the Government's case is absolutely scandalous.  Firstly, it has misled the Court about what the Ombudsman's report actually says (the Ombudsman will intervene to explain how the Government is misleading the Court).  For example, the Government has tried to pretend that the Ombudsman's findings relate only to two leaflets.  However, the truth is that the Ombudsman's report contained 100 pages of description of how all official information was inaccurate or potentially misleading.  In an unbelievably arrogant manner, the Secretary of State says that he cannot be expected to 'trawl through' 100 pages of the Report!  So here we have the Government saying the Ombudsman's investigation and conclusions have been irrational and wrong when he has not even bothered to read what she said! 

Secondly, the Government is arguing that only the House of Commons can decide whether Ministers are right or wrong.  This is a dangerous challenge to our democracy.  Any Government, then, with a large Commons majority, can over-ride citizen's rights and there will be no protection for innocent civilians whatever.  Ministers can simply lie about what independent verdicts have actually said (as the Government is doing in this case) and the truth will never prevail. 

Thirdly, the Government is also arguing that its Financial Assistance Scheme (FAS) has sorted out the problem properly and will pay 80% of members' pensions.  But the reality is that only 1,300 of the 125,000 victims have had any money at all (even though there are already over 10,000 past age 65 who need help immediately) and the FAS does not pay 80% of the pension they would have received from their scheme.  The Government has used political spin to placate its own backbenchers by inventing a term called 'core pension' which is not the members' expected pension at all and then taken 80% of that!

The Government has also killed off the amendments to the Pensions Bill that were passed by the House of Lords and would have provided a fair and final resolution of this scandal.   The Pensions Minister argued that it was cruel and irresponsible of political opponents to try to promise victims more money when it might not be 'affordable' .  However, the amendments were backed by a cross-party group of MPs and called for all 125,000 victims to be treated the same as those in the far more generous Pension Protection Fund in future.  Their trustees would have been allowed to pay their entitlements immediately and they would have been paid as soon as they reach their scheme pension age (not age 65 as the FAS decrees).  The Government's own figures show that this would cost less than £20m a year and its own Review has shown that this would not need to cost the taxpayer anything at all by using scheme assets more intelligently than buying annuities as they do now.  In light of this, it is clear that it is actually the Government itself that is being 'cruel and irresponsible' by stubbornly denying a fair rescue to these victims and forcing them to fight in court and wait for still more reviews and consultations.  How many more of them have to die before the Government does the decent thing?

Having gerrymandered the political process, the Government is now trying to use the Courts to deny justice to the victims and I firmly believe that the three Appeal Court judges will stand up for our constitution and protect our democratic safeguards.

Somebody needs to show this Government that it cannot behave as a dictatorship.  We have recently heard much about moving away from political spin and listening to Parliament and the people, but when it comes to matters that it finds uncomfortable, the Government seems to want the power to do exactly as it pleases.

I sincerely hope that the Court of Appeal - with the assistance of the Parliamentary Ombudsman - will show the Government just how wrong it is!

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