Bethan Jenkins AC/AM Blog

Visteon protesters in Parliament Square, opposite the Palace of Westminster

I GOT up very early on Wednesday to take a bus to Parliament Square in Westminster with ex-Visteon workers who are campaigning to receive their full pension rights from Ford. Thanks to Billy King for the lift from Pontardawe (I was treated like a VIP the whole time, apart from the banter with the bus driver…).

The long and short of it is that in 2000, when Ford transferred its employees to Visteon, it guaranteed mirrored terms and conditions, lifetime protection, and protected pension rights. The reality is that these commitments haven’t been honoured by Ford, that the pensioners are facing reductions in pensions by up to 50% if their fund goes in to the Pension Protection Fund scheme, creating considerable financial hardship as a result.

I’ve attended most of the packed public meetings in Swansea on this issue, but joining the ex-workers on the London demo was an opportunity to get to talk to individuals about what these changes will mean for their lives. Some tell me they may have to sell their houses, others want to move away to get away from it all, some are feeling the strain mentally, while others have suffered physical ill health over the worry that their pensions will be so severely cut. As Emma Denholm, the South Wales Evening Post reporter who joined us on the demo said in her article today, despite the severity of the situation, there is a tremendous sense of camaraderie amongst the former Visteon workers. They are supportive of each other, devoting hours on end to running the campaign. What astounds me is how former workers from the Basildon plant travel to Swansea for every meeting to give those present an update on the UK wide situation. That is what I call dedication. One ex-worker I met on the demo from Enfield said that he is looking for new work but the campaign has taken over his life.

The pensioners and ex-workers have appreciated the help I have tried to give them from the outset, and have been open and friendly. Travelling down to London, however, I felt immensely frustrated that the Welsh Government could not do more to help them. This area isn’t devolved to the National Assembly for Wales, but I have sought to raise the matter with UK Ministers, the Secretary of State, Unite’s Welsh Convener Andy Richards (although I’m still awaiting a response), and I have met with a representative of the PPF.

Now we are waiting for Unite, the union, to declare on April 14th whether or not it will take out legal action against Ford for failing to provide the guarantees that it promised when so many staff transferred to Visteon, only for it to go bust, and for Ford to seek to wash its hands of the Swansea Visteon workers, and those in plants over the UK and the North of Ireland.

Bethan addresses Visteon pensioners outside Unite's headquarters in Holburn

I’ve attended many demonstrations, but this one will have a lasting affect, as I know how urgent the situation is. Its vital that Unite takes legal action against Ford to support their members, so that these pensioners can at long last enjoy the retirement that they deserve after 40 years of work. If Ford gets away with this, could this not set a precedent for the future? Other companies will think that setting up spin-off companies, allowing them to fail, and denying pension obligations will be acceptable. This issue cannot be used as a blue print for company management. Ford won an ethical award this week. The irony wasn’t lost on me, either.

Angela Smith MP, who put forward the Early day Motion at Westminster spoke at the demo, but it was sad to see how few MPs came. Yes, many sent emails of apology and support, but their presence even for five minutes would have been much appreciated. Gerry Adams was hosting an event at Stormont for former Belfast Visteon workers and sent a message of support, as did Tony Benn. Peter Hain wasn’t there again but he made sure that the Union Convener in London communicated that.

Yet the speeches from former workers in their uniform Ford ‘fraud’ caps and t-shirts were strong, and made up for the lack of political representation. All were adamant that the campaign carries on and that pressure must be kept on Ford. Some of the pensioners are political and are members of political parties, but others are new to having to lobby Ministers. Even the ones that were members of political parties felt constrained by the fact that when they were union conveners they had the power to change working conditions and salaries. Now they cannot control the situation, and are reliant on others to a large extent to take the battle forward.

What struck me was that Ford are fighting this, yet most pensioners I talked to drive a Ford car. They still have vouchers for discounts on the car. If they are no longer associated with Ford, how do they receive this support? Even if they didn’t receive the vouchers,  I can bet you they’d still get a Ford car.  There was an immense tension between the ex-workers being proud to have worked for For, supporting the manufacturing industry in Wales, and the anger that they currently feel towards Ford for failing to appreciate this dedication, or understand why the pensioners are aggrieved at the way they have been treated.

One of the Swansea pensioners sums up what could happen if Ford win

Incidentally, I was emailed from 10 Downing Street petitions system today regarding the petition by the Visteon Pension Action group. Here is the Government’s response below. The long and short of it is this, at the bottom of the petitions which states, ‘The Government trusts the Pensions Regulator and the Pension Protection Fund to complete their assessments to the highest possible standard and understands you will be informed of their findings in due course’. Make of that what you will.

………………………………………………

“We the undersigned petition the Prime Minister to ensure that Ford Motor Co; honours its pensions commitment to its former employees.”

Details of Petition:

“In June 2000 Ford Motor Company spun off a new company staffed by its own Ford employees. This new company was called Visteon UK Limited. The transferred employees were Guaranteed mirrored terms and conditions for life, including Pensions. In March 2009 Visteon UK Limited went into administration, leaving an underfunded Pension scheme; not before they had created another Visteon Company in which to transfer certain staff/managers (which is still trading today), leaving all the bad debts and pensioners behind. The Visteon UK pension scheme is now being investigated by the Pensions Regulator and despite support from the Pension Protection Fund, some former Visteon employees are facing cuts in their pensions by more than 40%. There is great concern for any enforced financial loss to members and their families of the pension scheme, who had received this lifetime guarantee in terms and conditions. We call for the government to ensure that Ford Motor Co honours its commitment to its former employees, thereby avoiding entry into the Pension Protection Fund. Visteon Pension Action Group.”

Read the Government’s response
The Government has great sympathy for the members of the Visteon pension scheme.

Protecting the benefits of members of occupational pension schemes remains a fundamental part of our pension policy.

Under the Pensions Act 2004, the Government established an improved regime to protect pension scheme members’ benefits. This included the creation of the Pensions Regulator and the Pension Protection Fund (PPF) as independent bodies that operate at arms length from the Government.

The Pensions Regulator has a number of powers it may use in pursuit of its objectives, including measures to address the risk of “anti-avoidance”, where an employer may deliberately manipulate their affairs so as to try and shift their pension liabilities to the PPF. The Regulator has the ability to intervene and consider use of its Contribution Notice and Financial Support Direction powers in such circumstances, although these powers operate within a legal framework and there are certain tests that must be satisfied in order to justify the use of these powers. In order to assess whether the use of its powers are appropriate, the Regulator needs to gather and scrutinise information to enable an accurate view to be formed.

The Pensions Regulator is looking into the circumstances leading up to the administration of Visteon, and the impact on the pension scheme, and is currently working with a number of different sources to progress its enquiries. The Regulator has to carefully consider all the available evidence in order to assess whether there are grounds for regulatory intervention. Due to the volume and nature of the information, this process is expected to take some months.

The PPF was established to pay compensation to members of eligible defined benefit pension schemes when there is a qualifying insolvency event in relation to the sponsoring employer and where there are insufficient assets in the pension scheme to provide PPF levels of compensation. Those scheme members can therefore be reassured that they will still receive a meaningful income in place of the pension they have contributed to during their working life.

Let's hope Downing Street is listening

Following the insolvency of the sponsor employer, Visteon (UK) Ltd, on 31 March 2009, the company pension scheme entered a PPF assessment period. An assessment period lasts for a minimum of one year. During the assessment period, the scheme trustees retain responsibility for the day-to-day running of the scheme and for paying benefits to members.

The purpose of the PPF assessment period is to consider if the scheme can be rescued and also if the scheme can afford to secure benefits which are at least equal to the level of PPF compensation. If neither of these outcomes is achieved, the scheme will transfer to the PPF and the scheme members will receive compensation.

In general, the PPF pays 90% compensation subject to an overall cap (currently £28,742.69 at age 65) or 100% compensation if individuals are over normal scheme pension age when the insolvency occurs, or have taken ill-health retirement. Compensation is based on the scheme’s admissible rules. Payments made during the assessment period must be the lower of the PPF level of benefits or the amount originally payable under the scheme’s rules.

The Government trusts the Pensions Regulator and the Pension Protection Fund to complete their assessments to the highest possible standard and understands you will be informed of their findings in due course.