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Tuesday, September 07, 2004
The resignation of Andrew Smith, Minister for Work and Pensions

The MP for Oxford East, the Rt Hon Andrew Smith, asks us to see his resignation at face value. He says that, amongst other things, he wants to spend more time on constituency matters. He says that it’s often more effective to make government work while on the backbenches. If we take him at his word, there is an intriguing possibility.

In 1992, I met Andrew to discuss the terrible state of pensions, in particular those that had been plundered by Robert Maxwell. Andrew then believed that the government should compensate the defrauded pensioners. (Note that he said ‘Pensioners’, not ‘Pension Schemes’). He was in opposition then – opposition MPs can, of course, be a bit freer with their ideas and opinions than those on the government benches. They are even more effectively gagged when they become ministers.

During the 1990s, pension legislation was tightened and I have seen correspondence with Pensions ministers from Andrew Smith, that attest to his zeal in looking after pensioners’ interests.

When he became pensions minister, one could only applaud: here was someone in the driving seat who might, after all, get this cankered legislation regarding contributory pension schemes sorted out. As I have often observed, government regulations are very good at stopping prospective pensioners getting their hands on their money; they are not so good at stopping other people from stealing it.

After the Maxwell debacle, Sir John Cuckney, the industrialist and former MI5 officer, went round various financial institutions with a begging bowl. “You guys supported Maxwell in his shady dealings, turning a blind eye to his highly questionable activities,” he said. “If you now cough up money to go into the plundered pension schemes, the authorities may not look any further into your own naughtiness”.

Sir John came up with quite a lot. For more detail, see Tom Bower, Maxwell -The Final Verdict, (London: HarperCollins, 1995), pp.376-7. The cash raised was, so I understand, available to the four Maxwell pension schemes affected. However, dividing the booty was handled very badly: the schemes were asked what their requirements/shortfalls were and, apparently, the first pension schemes in line got what they asked for. Except, of course for the last of the four schemes in line: when they got there, the cupboard was (virtually) bare. This method of sharing out was never to have become public: it was manifestly so incompetent/inequitable. We have chance to thank that it did: key people in different schemes knew each other.

About eighteen months or two years ago, the trustees of the last scheme in line – Maxwell Communications - wrote to their deferred pensioners (those not yet drawing a pension) telling them that their prospective benefits were being halved. A group of them got together and arranged a meeting with their constituency MP, Andrew Smith.

Andrew was sympathetic but very non-committal; he had been very well briefed but his position as Pensions Minister obviously made it difficult for him to say anything positive. However, his general demeanour indicated that he thought the situation very unsatisfactory. When he said that he would look further into the matter, he did not raise false hopes.

A while later, his formal letter effectively said “Tough but no more dosh”. One bit springs to mind: the distribution arrangement for Cuckney booty was ‘Confidential’. Significantly, he did not deny the arrangement and that the pensioners had been screwed yet again. No wonder, as a government minister, he wanted it kept quiet.

During the last few days, the government-appointed trustees for the Maxwell Communications Pension Scheme (Capita) have been canvassing prospective pensioners to check the accuracy of the information held on file for them. Distressingly, these letters indicate that the halving of benefits is still expected.

Will Andrew Smith ever quite live down his speech in which he said with vigour “Hands off our air,” as a reaction to the Conservative government’s plans for the privatisation of Air Traffic Control? One has to doubt it. However, there is one area where he might, just possibly, be able to blur that memory further: by fighting for pensioners.

So, if Andrew Smith, says that, amongst other things, he now wants to spend more time on constituency matter and that one can often be more effective from the backbenches, is it too much to hope that he will quickly be turning his attention to a small group of pensioners in his constituency who have been screwed twice over? It’s bad enough to have been victims of the rapacious Bouncing Czech; to be subject to a further series of lackadaisical government bureaucratic actions and inactions is the ultimate humiliation.

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