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Media Stories: 23/02/2007 - Telegraph Articles

Daily Telegraph, Jeff Randall 23rd February, 2007

Labour is too morally bankrupt to pay pensioners what it owes

After a decade of Downing Street's lies and deception, it seems unlikely that anyone with an IQ bigger than his shoe size accepts Mr Campbell's view of life. Even the village idiot would surely have been disabused of such a notion by events in the High Court on Wednesday.

It was a triumph for decency over dissemblance. One for the good guys, who had to withstand threats that they would be hounded for every penny of costs if they lost.

Throughout this disgraceful affair, the Government has failed miserably to explain why these unfortunate souls should be hung out to dry. What it has demonstrated, however - beyond any reasonable doubt - is its readiness to bully little folk, manipulate numbers and distort facts.

By comparison, back-street bookies in a banana republic seem paradigms of financial integrity.

The Prime Minister bangs on that any solution must be "affordable". Oh, please. This from a man who has spent billions on a war that was justified by a dodgy dossier about non-existent weapons of mass destruction. Cheating, connivance and corruption have become indelible trademarks of the Blair regime.

The DWP suggests that full compensation for dispossessed pensioners would cost the taxpayer about 15 billion. Frightening, eh? Yes, it is meant to be. In fact, the payout would be nothing like that. Intriguingly, the Treasury refuses to reveal its estimate of the cost of full compensation.

Hargreaves Lansdown, the pension consultancy, says that the DWP's 15 billion figure is not one recognised by anybody in the pensions industry. "The true cost is likely to be nearer 3 billion to 4 billion." Ros Altmann, a former adviser to the Treasury, reckons the peak cost to the taxpayer would be 150 million a year, diminishing steadily as claimants passed away.

Given that the Government spends more than 550 billion annually, bailing out these bereft pensioners would be little more than a rounding error on Gordon Brown's Budget, ie, less than 0.05 per cent of his total expenditure. It may sound daft, but 150 million is lost between the cracks in the Chancellor's paperwork. Fraud and error in the benefit system alone cost the taxpayer 2.6 billion last year. Cash is not the problem. There's plenty of it sloshing about. The Government is not bust, merely morally bankrupt.

As for ministers, they have voted themselves gold-plated, diamond-encrusted, fur-lined, leather-upholstered, deluxe retirement schemes, all paid for by taxpayers who have no such benefits and face the prospect of working to 67 in order to make ends meet.

Cash for honours? Certainly, Sir. Cash for pensioners? On your bike.


Daily Telegraph editorial Thursday 22nd February, 2007

Shabby excuses

One of this Government's most unappealing habits is its refusal to accept responsibility and apologise when it gets things wrong. But the day when it must display at least a shred of penitence for its shameful behaviour towards people who have lost their occupational pensions must surely be approaching.

Yesterday, the High Court ruled that the Government should not have rejected the report by the Parliamentary Ombudsman, Ann Abraham, on collapsed company schemes.

Miss Abraham found that the Government had misled people who joined occupational schemes by failing to make clear the risks involved. She described the Government's advice as "inaccurate, incomplete, unclear and inconsistent".

A total of 125,000 employees discovered this to their cost as they lost their pensions when their companies collapsed. A private-sector company offering such cavalier and misleading advice would face punitive financial sanctions.

Miss Abraham said the Government had a duty to compensate them for the loss. Its response? It dismissed the report out of hand and refused even to apologise. This is not the first such ruling.

Last month, the European Court of Justice ruled that the Government's protection for pensioners had been "inadequate". Yet the best that Tony Blair could muster in the Commons yesterday was a less than wholehearted expression of "sympathy" for the pensioners' plight.

Such shabby behaviour is of a piece with New Labour's dismal record on pensions. Gordon Brown's 5 billion-a-year tax raid on pension funds has transformed what was one of Europe's strongest private pension sectors into one of its weakest.

Not everyone has suffered, however. MPs have a pension scheme that is among the most generous in the world. A recently discovered 50 million shortfall will be made up by - you've guessed it - the taxpayer.

It's time similar generosity was shown to those workers who have seen their retirements wrecked because they were nave enough to take the advice of this Government at face value.