Steel pensions 'feeding frenzy' concern raised by MP

Steelworkers have until mid December to decide on whether to join the new scheme

Commons leader Andrea Leadsom said she was "very concerned" at claims pensions changes have led to unscrupulous advisers targeting steelworkers in south Wales.

The issue was raised in the Commons by Blaenau Gwent Labour MP Nick Smith.

He quoted Financial Times reports of a "feeding frenzy" by pensions advisers.

The newspaper reported the Financial Conduct Authority was investigating the claims and would visit financial planning firms in Wales.

Mr Smith, whose constituency includes many retired steelworkers, said: "Today's Financial Times reports concerns over a 'feeding frenzy' by unscrupulous pensions advisers targeting steelworkers in south Wales.

"So can we have a statement from the government and action by the Financial Conduct Authority."

Ms Leadsom told him: "I'm very concerned to hear about the issue you raise. I do encourage you to write to the department or indeed to take part in oral questions on this specific point which does sound to be of great concern."

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Nick Smith raised the issue with Andrea Leadsom in the Commons

The British Steel Pension Scheme (BSPS) welcomed reports that the FCA was to investigate.

"Eligible BSPS members have a legal right to transfer their pension, should they wish to, subject to getting independent financial advice from a regulated advisor if their transfer value is more than £30,000," said a spokesman.

"Such decisions should not be made lightly as they cannot be reversed."

The BSPS said while its trustee could not give advice, it urged members to consider the value they get from a guaranteed defined benefits scheme verses the un-guaranteed returns that may be available after transferring their benefits.

It said further details were available on its "time to choose" website.

Meanwhile, the BSPS has confirmed it is confident problems faced by some of its members about their financial future will be resolved.

Concerns have been raised some members had not received vital information regarding their pension fund.

The pension scheme is worth £15bn and involves thousands of current and former steel workers, with 130,000 members across the UK.

The BSPS said it had been working with those affected to ensure they had all the information required to decide on which pension scheme they should join in future.

The scheme's trustees encouraged those with missing data to contact them or check their latest deferred benefits statement.

Steel company Tata formally separated its UK pension scheme from the business in September.

About 8,000 people are employed by Tata Steel across England and Wales, including 3,500 in Port Talbot

All members of the BSPS have been invited to transfer to a new scheme and must decide by 11 December.

It would have lower future annual increases for pensioners and deferred members than the BSPS, but Tata said the pensions deal was the only viable option to secure the UK business.

The BSPS has been holding roadshows to discuss their options.

The Pensions Regulator said: "We are aware that some members will have received option packs without personal illustrations.

"The BSPS trustee has released a statement on the BSPS website explaining why these members' option packs did not include these illustrations.

"They have also advised what support will be available to affected members to ensure they are able to take informed decisions."