British Steel Pension Scheme: Transfers

Stephanie Peacock Excerpts

Wednesday 10th April 2019 Westminster Hall

[Nick Smith]

My hon. Friend makes an important point. Given reports that the FCA is investigating so-called introducers in connection with a major scam, the Government should now ensure that they, too, are regulated. The Treasury has to take action to ensure that financial advisers always have—this comes to my hon. Friend’s point—sufficient insurance to pay out, should they go into administration.

Will the Minister ensure that the FCA updates the Treasury on how it is supporting the potentially several thousand steelworkers who might have received poor transfer advice in this instance? The Treasury needs to co-ordinate with the Department for Work and Pensions and other key bodies in order to help victims of mis-selling to access the support they need. Although BSPS members have been supported by a strong team in Port Talbot, including a financial adviser and a lawyer, there needs to be a single initiative, aimed specifically at people who may have been mis-sold in cases such as BSPS.

[Stephanie Peacock (Barnsley East) (Lab)]

I am very grateful to my good friend for giving way and congratulate him on securing the debate and on the powerful case that he is making. In the consultation on the changes, concerns were raised that the burden could fall too heavily on scheme members, and we worry that that is the case. Our mining and steel communities built this nation. Does my hon. Friend agree that they should be looked after in retirement?

[Nick Smith]

My hon. Friend is a champion for miners’ pensions, on which she has done some great work, and I think she is absolutely right.

I press the Minister on the Treasury’s response to recommendations that others have made about the crisis. The Rookes review suggested that the FCA needs to look at how it handles advisers who have had regulatory issues in the past. Phoenixing, as it is called, has allowed some advisers to reinvent themselves to sell anew. There must be greater scrutiny to stop rogues re-emerging in the marketplace. The review also suggested that the FCA work with the Treasury and the DWP to use digital channels to help to communicate important information to pensioners and to help them.

Finally, the review suggested that the Pensions Regulator work with BSPS, trustees and trade unions—Community and Unite have been particularly good in south Wales—to select a panel of reliable financial advisers that members can use. Those advisers must be able to deal with the scale of the problem with BSPS and with the insurance needed. Can the Minister explain how the Department is progressing those recommendations and when we can expect the changes to be fully implemented?

In his valedictory speech, Mark Neale, the outgoing chief executive of the Financial Services Compensation Scheme, strongly advocated increasing the compensation limit in cases of poor transfer advice. They were powerful remarks, so let us listen to him. I ask the Treasury to actively support that proposal and to investigate how many people are currently suffering uncompensated financial losses because of poor advice.

We need justice for steelworkers who are ripped off. If the FCA will not do that, local police forces in south Wales need to pursue what appear to be complicated cases of fraud. The crimes are committed locally; the losses are clear and often substantial; and those responsible are identifiable. I call on the police forces across south Wales to open files and thoroughly investigate whether those cases amount to fraud. Criminal investigations have to start. If they do not, I call on the forces to state publicly why not.

The financial and emotional toll that this crisis has taken on my constituents and many others has been heavy. They worked hard for decades to earn their pensions, and they expected a secure pot to provide for them and their families. That was put at risk because of the wrongdoing of a few bad actors and a weak response from the regulators. Steelworkers and their families have been let down. The Government and the FCA must improve their act and support those people better. The rogues who ripped off steelworkers and their families must be held to account. If the regulators cannot do that, the police need to step in. We need to make sure that good people see their hard-earned money better protected in future.