Steelworkers’ pension scandal brewing, warns Labour MP
A Welsh MP has warned in the House of Commons of a “steelworkers’ pension scandal” brewing.
Blaenau Gwent Labour MP Nick Smith accused the Financial Conduct Authority (FCA) of providing insufficient support to steelworkers choosing where their savings should go when the British Steel Pension Scheme (BSPS) ends.
Experts have said some financial advisers are having a “feeding frenzy”.
The FCA has been asked to comment.
Mr Smith said: “I am afraid of a steelworkers’ pension scandal brewing.
“Constituents of mine are worried about making the wrong decision for a pensions transfer.
“The Financial Conduct Authority [FCA] is, I think, providing insufficient support to steelworkers at this crucial time.”
Mr Smith asked for a statement from a UK government minister and an action plan from the FCA “to support steelworkers trying to do the right thing for their families.
Commons leader Andrea Leadsom told him: “pensions is of course a complex subject and for anybody who is trying to make decisions they do need the right advice for that.
“You are right to raise it in this chamber and I do encourage you to seek further guidance from the FCA so you can provide support to your own constituents.”
There are around 130,000 current and former workers in the BSPS in the UK.
As it ends, they have the choice to transfer to a new scheme, which is less generous but still better for most people than a second option, the Pension Protection Fund.
But it is a third option, transferring out of the scheme completely, that is causing most concern.
A steel union has said it could take legal action if there is evidence its members have been mis-sold pensions by independent financial advisers.
Members of the pension scheme now have until 22 December to decide where to transfer their savings, after an earlier deadline was extended by 11 days.