Pension Funds

Lee Pitcher Excerpts

Wednesday 23rd April 2025 Commons Chamber

[Manuela Perteghella (Stratford-on-Avon) (LD)]

Pension funds hold not just financial value but moral weight. How we treat our pensioners, and how we invest in the future of the hard-working people of this country, says everything about the kind of society we are. I want to bring to the House’s attention one of the most concerning injustices faced by thousands of former HSBC employees, particularly women: the use of an outdated, punitive policy known as pension clawback.

I support the Midland Clawback Campaign, which seeks justice for the 51,000 affected members of the Midland bank pension scheme, now administered by HSBC, who were misled about the nature of their retirement income and are being short-changed as a result. Unlike most other institutions, which phased out clawback in the 1980s, HSBC continues to enforce it in its most punitive form. Clawback was originally introduced in 1948 to offset national insurance costs when the state pension was created. Midland bank introduced clawback to its pension scheme in 1975 as a cost-saving measure.

Former employees were told that they would receive a defined-benefit pension at two thirds of their final salary, in addition to their state pension. Instead, when they reached state pension age, HSBC began deducting a portion of their occupational pension, calling it a “state deduction”.

[Lee Pitcher (Doncaster East and the Isle of Axholme) (Lab)]

I have a constituent who has worked for 44 years at Midland bank and HSBC. They were promised a pension of two thirds of their final salary, but they now face a 16% cut—that is over £1,700 per annum—because of the so-called state deduction. They were never told that the scheme was integrated, and even private pension reviews failed to explain it. Does the hon. Member agree that that lack of transparency is unacceptable and that workers like my constituent deserve answers?

[Manuela Perteghella]

I fully agree. The term itself is misleading. The money is not being taken by the state; it actually goes back to HSBC. Had it been labelled properly, as an integrated pension deduction, many people would have asked questions much earlier.