More than 1,000 former and current workers at APW - the UK electronics manufacturer, which announced the winding-up of its pension scheme yesterday - are set to lose up to 80 per cent of their retirement savings, after the Government rejected plans to close a loophole between its two pensions safety nets.
The wind-up is the second such case this week, after Henlys, the bus group, left more than 2,000 workers' pensions in jeopardy when it announced it would be winding up its pension scheme on Wednesday.
Despite a fortnight of debate over the final structure of the privately funded Pensions Protection Fund (PPF), and the Government-backed Financial Assistance Scheme (FAS), members of the APW and Henlys schemes are still set to fall outside the requirements to qualify for either lifeboat.
Although the Government has said that pension schemes of insolvent companies that wind-up before April next year will be covered by the FAS, it has stopped short of providing any solution for companies such as APW and Henlys, where the scheme is being wound up to prevent insolvency.
Last week, the Liberal Democrats failed to pass a motion in the House of Lords to ensure that members of so-called "solvent wind-ups" are compensated by the FAS. Lord Oakeshott said: "This is the kind of scandal we tried to avoid through the amendment we put last week. It would be a scandal if the APW workers fall between both schemes and are not compensated."
Amicus, the union, is to meet the Department for Work and Pensions next week to try to secure a compromise for the APW and Henlys scheme members.
Meanwhile, the Lib Dems and Conservatives yesterday lost their attemptto scrap rules which compel people to buy an annuity at age 75.Reuse content