[A-List] UK legitimation crisis: Maxwell pensions
michael.keaney at mbs.fi
Tue Dec 3 03:26:27 MST 2002
Don't expect much by way of clarity regarding this issue: the person
responsible for "fixing" the mess of the Maxwell pensions scandal and warmly
praised for doing so in parliament by John Major was "Sir" John Cuckney,
"former" MI5 agent, merchant banker and general bagman for the British
secret state, as in the Westland affair. Good reason for Blair and co. to
want to sweep everything under the carpet, especially when one considers
just how close to Maxwell were so many of Blair's inner circle and key
supporters (e.g. Alistair Campbell).
Maxwell staff face 50% pension cut as government refuses extra support
Tuesday December 3, 2002
The government was forced yesterday to defend its refusal to support
employees of the former publishing tycoon Robert Maxwell after it was
revealed that a huge deficit in their pension fund will cut retirement
payments in half.
Letters due to be sent out today will tell up to 1,500 former workers at
Maxwell Communications that their hopes for a decent retirement income have
The letters will say that three and a half years of talks have failed and
that ministers have refused to pump any more money into their scheme.
The scheme's trustees said a £10m deficit in the fund when the talks started
had grown to £40m. They said that following the breakdown in talks they had
no alternative but to halve the pensions of scheme members.
Fomer social security minister Peter Lilley and Labour MP Frank Field
yesterday wrote to the National Audit Office asking for an inquiry into the
sudden drop in the fund's value.
Mr Lilley, who was Secretary of state for social security when Mr Maxwell's
empire collapsed in 1992, said last night he was very concerned for the
pensioners. He said it was not clear why the fund could not meet its
A spokeswoman for the department of work and pensions said talks held over
the past three years had failed to come to an agreement, mainly because the
government was unwilling to underwrite the fund. "It would set a precedent
for other pension schemes and other Maxwell pension schemes if we had agreed
to the request for the money."
The trustees said the original settlement that secured funding for the
Maxwell pensions was flawed and it was the government's responsibility to
make up the shortfall.
The problems date back to the fall of the Maxwell empire and the settlement
of a long-running legal battle in 1995. The deal was expected to give
long-term support for four schemes with 35,000 members, all ex-Maxwell
The government brokered a deal with financiers who advised Robert Maxwell,
including his auditors Coopers & Lybrand and investment advisers Lehman
Brothers. They agreed to contribute £276m to the schemes. The government
also waived £100m needed to secure workers' state pensions.
The trustees for the Maxwell Communications scheme, the Law Debenture Trust
Corporation, objected, claiming their pensioners lost out, but their action
was dismissed in court.
When it emerged that the printers' fund was in surplus, the trust requested
the money be transferred to the Maxwell Communications schemes. The
government objected, and took the funds in part payment of the £100m debt.
Trustee Richard Thomas, said the government had given clear indications that
it was prepared to consider the Maxwell pensioners as one group and transfer
"We don't know why, but after several years of very constructive debate the
government has turned round and said no," he said.
Only former Maxwell workers who retired after 1992 or who are still waiting
to retire will be affected, he said.
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