Adjournment Debate: Trawlermens Pensions

Thu, Mar 17, 2011


Adjournment Debate: Trawlermens Pensions

On Wednesday 2 March 2011, Alan gave his first speech from the backbenches since resigned from the Opposition frontbench in January.

He applied to the Speaker of the House to secure an adjournment debate on the subject of trawlermens pensions: an issue he has been working on since uncovering the scandal in 2007.

He has been working with the other port MPs, Austin Mitchell and Frank Doran and with Thompsons solicitors in order to get justice for men who never received the pensions they paid into in the 60s.

As a backbencher Alan is now able to request adjournment debates and he used the opportunity to shed some light on an issue that he believes now needs concluding.

The speech he gave at the debate is below:

“The purpose of this debate is to bring to the attention of the House and the Minister a scandal involving the maladministration of a pension scheme that has left thousands of distant water trawlermen who reached retirement age up to 30 years ago without a penny of the pension they contributed to wholesale inflatable water slides.

First the context.

Distant water trawlermen worked in the most arduous and hazardous occupation imaginable, working 18 hour shifts in Arctic waters where temperatures could falls as low as 40 degrees below freezing.

In 150 years of distant water trawling from Hull which was exclusively a distant water port and the biggest in the world, 900 ships were lost at sea and 6,000 trawlermen were killed. The mortality rate was 14 times higher than coal mining.

When the industry collapsed as a result of the agreement between Britain and Iceland that ended the so called “Cod Wars” in 1976, the men were promised compensation, re-training and re-deployment by a government Minister from that despatch box.

They received nothing. Classified as casual workers, they were thrown on the scrapheap and whilst the trawler owners were paid millions of pounds in de-commissioning grants, not a brass farthing was paid to the trawlermen themselves.

That injustice was belatedly rectified by the compensation scheme introduced in year 2000, although there is still one aspect which my Hon.Friend the Member for Great Grimsby and I have referred to the Parliamentary Ombudsman.

As we worked with the ex trawlermen to achieve

that compensation, a number of them referred to a pension scheme that operated in the industry.

Some men over 50 had been allowed to commute their pension to a one- off payment to alleviate the hardship as the industry collapsed, but many men said they couldn’t remember receiving anything from the scheme even though they were now well beyond pensionable age.

>I established that there was indeed a Fishermen’s Pension Scheme established on 1st April 1961 by a Trust Deed made on 19th December 1960, between the British Trawler’s Federation Ltd. and Lowndes Associated Pensions Ltd.

It was a contributory scheme, the men paying sixpence per sea day and the employer nine pence. Contributions to the scheme ceased in 1979 and benefits ceased to accrue.

The benefits accrued up to the date of discontinuance secured by a group deferred annuity contract underwritten by what is now Aviva. Capital Cranfield became the trustees when they acquired Lowndes in April 2000.

Having established these facts, I wrote to Aviva in 2006 to find out if any pensions remained unpaid. My impression was that there may be around l00 such cases may have occurred.

By 2007 I had discovered the scandal of a scheme where few records had been kept and no effort had been made to track down the men whose pensions were due.

Over four and a half thousand trawlermen from Hull, Grimsby, Aberdeen, Fleetwood, Milford Haven and North Shields, had reached pensionable age from the l980s onwards without receiving the pension they were due. About a quarter of them from Hull.

The reason for this disgraceful maladministration was that the only records kept of members were their surname, initials and date of birth. There was no record of the men’s National Insurance numbers, or their addresses, nor any other pertinent information from which they could be traced.

There had been no attempt to rectify this situation, nobody was alerted to the problem in the communities affected, the unpaid pensions simply remained in the scheme while many of the men lived out their old age in penury.

Aviva the insurers had been paying benefits (or more usually not paying benefits) without the intervention of the trustees since l986 at the request of the then trustee, Sedgwick Noble Lowndes, which as I said is now part of Capital Cranfield. This in itself seems a strange arrangement and one that neither party should have allowed.

As well as the 4 ½ thousand men who had reached pensionable age there were 8,879 still below age 65 with little prospect of receiving their money as they became eligible.

Since I wrote to the then Secretary of State at DWP and the Pensions Regulator in January 2007 to alert them to this scandal, a great deal of effort has gone into finding the missing fishermen.

Aviva has worked with local MPs on the Find the Fisherman Campaign which we agreed should run for two years.>At the end of that period, In October 2009, MPs met with Aviva and Capital Cranfield to take stock. Aviva in their briefing note for this debate talk about unclaimed assets being “common across the industry” and after setting out details of the “Find the Fisherman” campaign, they say that “some members remain unpaid”.

For ‘some’ read 6,837. That’s the figure we were given for the men who had not been and probably never would be traced at the end of the campaign. That’s over half the scheme membership.

Perhaps the Minister would tell me if he believes that this level of unclaimed assets is at all “common across the industry”.

Together with my Hon.Friends the Members for Great Grimsby, Aberdeen North, Cleethorpes and Fleetwood, who also attended the meeting with Aviva and Capital Cranfield in October 2009, I put forward proposals that would allow wind up of the schemes on a fair basis.

Firstly, we would need to agree how to distribute the surplus in the scheme coffers.

At that time it was £2 ½ million pounds, although I heard this morning that Capital Cranfield are saying its £1.3 million.The disparity has yet to be explained to us.

Secondly, provision needs to be made for unidentified beneficiaries who may come forward in the future.

Thirdly, we sought payment to the 50 odd families where payment is disputed. These are cases where Aviva say the money had been paid, usually in the l980s, but where they have no proof of payment and the families are adamant that it was never received.

In this respect let me explain to you the way the payment system worked as described by the Chief Executive of Aviva in a letter to one of my constituents:

“When an employer wanted to claim a pension on behalf of one of his employees he would make an application to the Royal National Mission who acted as an intermediary and would in turn apply to Norwich Union on behalf of the employer. Norwich Union would verify the details against the policy and authorise a payment to be made to the Mission who would then pay the employer so they are able to pass the money on to the individual fisherman”.

He goes on to say “I appreciate this will appear unnecessarily complex but, rightly or wrongly, this is how payments were settled in the past”.

So a scheme with no National Insurance numbers and no addresses, relied on trawler owners who were gradually disappearing as the industry was in terminal decline to go through the Seaman’s Mission, who incidentally informed Norwich Union, as it was then, that they did not have the resources to undertake this work, in order to give cheques to men who in the main did not have bank accounts.

We say that the benefit of the considerable doubt in disputed cases should rest with the men and their families.

Our final proposal concerns recompense. We feel strongly that some compensation should be paid to the men and/or their communities for the appalling way in which this scheme has been administered.

The Trustees and the insurers had a financial and moral responsibility to scheme members which they failed to fulfil. The way this scheme operated would have shamed a local sweepstake organiser.

The fact that the men whose interests they should have safeguarded did one of the most difficult and dangerous jobs imaginable and in the main spent their old age scraping for every penny whilst money that could have eased their plight was never paid to them adds to the sense of injustice felt within these proud communities.

Since October 2009, we have been fortunate to have the services of a pension’s expert from Thompson Solicitors, working pro bono on our behalf to try to bring the arrangements discussed to a successful conclusion.

Seventeen months later there has been little progress and no further approaches to the port MPs by Aviva or Capital Cranfield to resolve the issues that remain outstanding.

In the absence of any involvement by ex trawlermen or anyone from the affected communities amongst the trustees, I believe it is incumbent on Aviva/Capital Cranfield to seek our approval for the final arrangements to wind up these schemes.

Perhaps the Minister can tell us who are these companies answerable to?

I understand that they are proposing to agree their own fees for the wind up.

There must surely be some external oversight of these arrangements.

The port MPs wish to meet the Minister to explore the issues surrounding this scheme in more detail and we think it would be beneficial to have the Pensions Regulator present.

Surely he must have a role in ensuring that the schemes are wound up in an orderly and timely fashion with the interests of the members properly protected?

We seek from the Minister nothing beyond his understanding of how badly this scheme has been administered and his assistance in bringing this long saga to a conclusion acceptable to Port MPs as the representatives of affected communities.

Finally, I ask the House to imagine the outcry there would be if thousands of bankers, civil servants, or even former MPs had been treated in this way. It would be a huge story that we’d be following regularly in the national media.

This has been an almost silent scandal.

This evening’s debate will I hope bring it to the attention of a wider audience in the quest for justice for communities who contributed so much, sacrificed so many and yet were treated so abysmally.”

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