The Fairy Godmother of Pension Funds

Saint Robert de Maxwell,
Claims that Honest Bob and Little Nell were lovers are nothing but scandalous gossip.

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Hurtful and wicked journalism

The Guardian, Saturday 10 May 1997

Saturday Notebook

Tony Blair's appointment of Helen Liddell to the post of Economic Secretary at the Treasury is surprising, given Ms Liddell's close involvement with Robert Maxwell's empire. Do those tainted by Maxwell merit important positions within the government ?

The Guardian, Saturday 17 May 1997

Profile: Helen Liddell

Despite a saucy novel to her name and connections to Robert Maxwell, Helen Liddell has been appointed Economic Secretary in Gordon Brown's powerful new Treasury team. The 46-year-old Scot cannot quite believe that she has attained such heights after just three years as an MP, but having got the job she has lost no time in making her mark - as the pensions companies are only too aware.

From a speech by the Rt Hon Peter Lilley MP, Shadow Chancellor of the Exchequer, to the Conservative Party Conference at Blackpool 1997

Tony Blair said he wants pensioners to be cherished and valued to the end of their days. So why is he plundering their pension schemes for as long as they live?

So much for the giving age - more like the give and take age. We give, they take.

The centrepiece of Gordon Brown's Budget was his Pensions Tax. If the Government takes billions of pounds out of pension funds every year, either employees and their firms will have to put billions more in, or people's pensions will be cut. Gordon Brown hoped people wouldn't notice the money leaving their funds until they retire.

The last Socialist to have that bright idea about pension funds was Robert Maxwell. No wonder this year's Budget has become known as the 'Robert Maxwell Memorial Budget'.

But then this Government is the Robert Maxwell Veterans' Club.

I have to be careful what I say about Alistair Campbell, Tony Blair's Press Secretary. The first time someone accused his boss of robbing pension funds, Mr Campbell tried to punch him. Of course, then his boss was Robert Maxwell.

But to be fair to Mr Campbell, there were mitigating circumstances. The man he took a swing at was the Political Editor of the Guardian. Though I have to tell you, he missed.

Then there's the Treasury Minister, Helen Liddell. Former Public Affairs Adviser to Robert Maxwell. So they put her in charge of pensions mis-selling.

The only Minister with equally good credentials for her job is Dawn Primarolo. Red Dawn. Prosecuted for refusing to pay her community charge. So now she is responsible for collecting your taxes.

They may be a joke. But robbing pension funds is no laughing matter. Make no mistake. The issue will not go away. The pension funds won't let it. The self-employed, whose pensions are worst hit, won't let it. 5 million people with personal pensions who will find they have to pay more, won't let it. And we won't let it.

Lords Hansard 27 th July 1997

Pensions Mis-selling

Lord Evans of Parkside asked Her Majesty's Government:

What action they propose to deal with the mis-selling of private pensions to the public.

Lord McIntosh of Haringey: My Lords, the Government are determined to see the case reviews completed quickly, and redress made where it is due. On 9th July, the Economic Secretary to the Treasury published details of progress towards redress, or lack of it, by the top 24 firms. The Government will continue to publish information on progress and will not hesitate to see that further action is taken, as necessary, to speed up reviews.

Lord Evans of Parkside: My Lords, I thank my noble friend for that reply. Does he agree with me that the risible progress of the 24 pension companies named by Treasury Minister, Helen Liddell, in compensating the victims of mis-selling of pensions is a disgrace that has besmirched the good name of the City of London? Can my noble friend confirm that some 20,000 victims of the scandal have died uncompensated since the companies began their review of the fiasco some three years ago, and that unless the Government take harsh and swift action within the next two or three months many thousands more will die uncompensated before their cases are reached?

Finally, does my noble friend agree that the Tory Government Ministers who launched this privatisation of pensions some years ago bear as much responsibility for the scandal as the pension companies?

Lord McIntosh of Haringey: My Lords, on my noble friend's first question, the aim of the Personal Investment Authority is to see that 90 per cent. of claims are dealt with by the end of this year, and 100 per cent. by the end of next year. I am not at all convinced that it will be achieved and, even if it were, I do not think it is good enough, for the reasons that my noble friend gives.

On the second question, about the responsibility of the previous Government, I have only too good reason to agree with him since I ran a company pension scheme myself for 30 years. The previous Government weakened company pension schemes by allowing individuals to opt out; weakened SERPS by reducing the returns; and encouraged people to opt out by what might be termed the DSS short-term bribe. The result was that hundreds of thousands of people opted out, many of them losing out because of mis-selling and the lack of adequate company contributions.

Lord Marsh: My Lords, will the Minister accept that no one can support the mis-selling of pensions where that existed and that resolution of the matter is long overdue--it should have been cleared up to a much greater extent and faster than it has been so far? However, will he further accept that the removal of tax credits has resulted inexorably in a large number of pensions, sold and purchased in good faith, now being clearly inappropriate for those to whom they were sold, purely and solely as a result of the Government's action?

Lord McIntosh of Haringey: No, my Lords, I do not agree at all. On the contrary, the Association of British Insurers has recognised that, in the longer term, the switch to greater capital appreciation and the reduction of lower dividend streams will actually be of benefit to pension funds. In the shorter term, I hope that insurance companies and pensions sellers will not use ACT as an excuse for delaying compensation.

Lord Clark of Kempston: My Lords, while I accept the fact that some pensions have been jeopardised as a result of mis-selling, does the Minister agree that the change in the fiscal treatment of dividends in pension funds is bound to mean that those pensioners will be jeopardised as well? Will he further agree that it is quite illogical for the Government on the one hand to try to encourage people to save for their old age and, on the other, to penalise that fund when it is set up?

Lord McIntosh of Haringey: My Lords, the first part of the noble Lord's question was the same as that asked by the noble Lord, Lord Marsh. I notice that the noble Lord now acknowledges that "some" pensioners were victims of mis-selling. That is a gross under-statement.

Baroness Turner of Camden: My Lords, does the Minister agree that, for the lower-paid, personal pensions were always unlikely to be a very good vehicle for retirement? Would it not be a good idea if some of these considerations were pointed out to people? Could not the financial services industry be given deadlines by which this whole fiasco should be cleared up?

Lord McIntosh of Haringey: My Lords, my noble friend is quite right to look to the future of pensions and not merely at the past. As she will know, the President of the Board of Trade announced only yesterday that there would be a new, arm's length financial services regulatory body which will be under the ministerial control of the Treasury rather than the Department of Trade and Industry. I hope she will feel that that, combined with the review announced by the Department of Social Security, shows our firm intention to see to it that in future the best kind of pension scheme is available to all, including the low-paid.

Lord Mackay of Ardbrecknish: My Lords, will the Minister accept that I agree with him that there was no excuse for pensions mis-selling, and there is no excuse for not putting the matter right--just as there was no excuse for the ex-Labour MP, Robert Maxwell, pillaging his members' pension funds? Nor is there any excuse, as the noble Lord, Lord Marsh, said, for Chancellor Brown taking £5.4 billion from pension funds in the future. If the Minister doubts that, will he read the comments of the National Association of Pension Funds?

On a more positive note, will the Minister agree with me that, for very many people whose employers do not provide pension funds, personal pensions are a perfectly appropriate and correct vehicle to provide income for their retirement?