Deadline looms for Maxwell pensioners

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The Independent Online
Sir John Cuckney, the government-appointed arbiter in compensation talks between Maxwell pensioners and City institutions, has laid down a two-week deadline by which agreement on a global settlement of all claims must be made.

If the talks fail, there is a real risk of an avalanche of costly litigation between representatives of 20,000 Maxwell pensioners and institutions holding disputed pensions assets.

Both sides have already ditched the Government's original vision of a global settlement and are now talking of a scaled-down "major settlement" between the main financial institutions holding disputed Maxwell assets.

If this is not agreed, a series of bilateral settlements between the pension trustees and the institutions may still be possible. But if the current talks fail, there is a possibility of a legal free-for-all, which could lead to years of uncertainty for the pensioners.

A sticking point in the talks has been the size of the institutions' payment to the pensioners. The pension funds needed between £280m and £300m to make up the amount plundered from them by the late tycoon Robert Maxwell, while the institutions have so far offered up to £240m.

Another problem has been the temporary withdrawal of one of the pensioners' representatives from the talks. Law Debenture represents 5,000 members of the Maxwell Communications Pension Plan.

Under the original terms of the talks, the government-appointed arbiter, Sir Peter Webster, said he would break off the discussions if any party withdrew. When Law Debenture did so last autumn, he announced his intention to give up his mediation role andreturn to the Bench. Law Debenture has since returned to the fray.

This has left Sir John Cuckney as the last remaining hope for a general settlement. The Government, which has never admitted any responsibility in the Maxwell affair, is keen to end its involvement in the talks. It has been criticised by representatives

of other unrelated failed pension funds, who complain that they have been denied the government support given to the Maxwell pensioners.

The Goverment funded a trust that will keep all Maxwell pensions fully paid until 1996.

A source close to the talks said that the Government's attitude to its aid to the Maxwell pensioners, which was always intended to be temporary, was: when does a task force become an army of occupation?

Institutions involved in the talks include Goldman Sachs, the American investment bank, which had extensive dealings with Robert Maxwell, and the accountancy firm, Coopers & Lybrand, which audited Robert Maxwell's 800-odd companies.

Ken Trench, chairman of the Maxwell Pensioners Action Group, said: "It would be a shame if we have come so far and don't get a settlement."