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ECJ SAYS UK PENSION PROTECTION MEASURES “UNLAWFUL”

Community Press Release
25th January 2007

The European Court of Justice (ECJ) has today ruled that current UK measures to protect the expected pensions of members of occupational pension schemes in the event of their employers' insolvency are unlawful and fail to meet the requirements of Article 8 of the Insolvency Directive. The case was brought by Community and Amicus unions on behalf of their members formerly employed by Allied Steel and Wire (ASW) in Cardiff and Sheerness.
 
Welcoming the judgment, Michael Leahy, General Secretary of Community - the union that represents over 95% of the ex-ASW employees, said:
 
"I am glad that the ECJ Judges have ruled that current UK measures to protect the expected pensions of members of occupational pension schemes in the event of their employers' insolvency are unlawful and fail to meet the requirements of Article 8 of the Insolvency Directive. This is what we have argued all along.
 
"This is a story of political failure by successive Governments. The Tory Government failed to implement the Directive properly and the Labour Government, whilst setting up the Financial Assistance Scheme, has failed to right the wrongs of the past. People will only have confidence in the UK pensions system going forward if those who have lost them their pensions through no fault of their own have them restored.
 
"The ECJ has clearly identified that current UK measures are unlawful. I do not believe that we should have to have recourse to the High Court - during which time our ASW members would have to endure further financial hardship - whilst waiting for the Government to accept its legal responsibilities. I believe that the Government should end their misery and admit its legal responsibility now.
 
"If the Government is not willing to recognise their legal responsibility and settle this matter then Community is ready to launch a parliamentary campaign to convince them to do so. I am delighted to be able to announce that Julie Morgan, Labour MP for Cardiff North, who has many ex-ASW employees amongst her constituents has agreed to table an amendment to the Pensions Bill currently before Parliament, to make the Government meet its legal responsibilities to the estimated 125,000 people similarly affected. Community will be contacting MPs of all parties and asking them to support the amendment and end this scandal once and for all."



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