Unions urge block on pounds 500m pension windfall

Click to follow
Rail unions have called on the pensions ombudsman to stop a pounds 500m rail pensions surplus being distributed to private rail companies.

The move came yesterday as the Government faced the prospect of having to pay back pounds 168m taken from the pension fund of bus workers just before privatisation of the National Bus Company in 1990.

Richard Rosser, general secretary of the Transport Salaried Staffs Association (TSSA) said yesterday that the unions would try any way possible to prevent the privatised rail companies from benefiting from the surplus.

He said: "They stand to make a small jackpot out of these funds and yet they contributed nothing towards them."

The move by the unions came after Sir George Young, the Secretary of State for Transport, reacting to The Independent's revelation about the windfall yesterday defended the right of companies to claim these surpluses.

He told BBC Radio 4's Today programme: "It is perfectly in order for any surplus to be shared between members and employers."

The Pensions Ombudsman has already found in favour of National Grid and National Bus Company pensioners in their efforts to reclaim surpluses which ended up in company or government coffers.

Yesterday, National Bus Company pensioners delivered a "Scrooge" Christmas card to the Department of Transport to press their case to recover pounds 168m appropriated by the Government after the privatisation of the company.

In September, the Pensions Ombudsman ruled that the Government had no right to the money from the Bus Employees Superannuation Trust, and told the pension-fund trustees to take all practical steps to recover the money from the Department of Transport.

Eddie Wignall, a former bus driver from Barnsley, said: "Some pensioners are getting pounds 20 a week less because the money was taken.

"The surplus should have gone to the employees," he added.

Until this week, the two trustees were junior civil servants who, according to the union, were reluctant to take action against their own department.

However, the department has now decided to replace the trustees with the official solicitor and, in a separate move, the union has been told that it can begin a legal action against the trust if it does not comply with the Ombudsman's ruling.

Two weeks ago, the Pensions Ombudsman ruled that the National Grid should repay the pounds 44m it took from the pensions fund after privatisation, opening the possibility that a total of pounds 500m may have to be paid back by privatised electricity companies.

Comments