Roadshow points and feedback

[Stephen Brichieri-Colombi]

At a recent Roadshow, it transpired in conversation that the Trustees object to HPA because 1. on our website we say that "HPA was born out of the failure to ensure that the interests of the members of the Halcrow Pension Scheme were safeguarded in the sale; and 2.  they felt we had been trying to block the 2011 sale.Point (1) is a matter of record (as noted in the Transcript of Judgment).  The fact is that the Trustees and the Pensioners were in agreement that scheme of arrangement should have been restructured to protect the HPS.  The judge noted "an HPS pensioner, appeared before me to oppose the scheme ... making points that had previously been made in correspondence with the Company, but were no longer pursued, by the trustees... (§5). He "expressed disquiet at the sudden and unexplained change of heart by the HPS trustees" (§26), and noted that "HPS itself has not objected to the scheme" (§46), a fact that was used against us by Halcrow. Had the Trustees engaged with tPR to ensure both were in court, the outcome could have been very different.Point (2) suggest the Trustees did not bother to ask why we were there. The Transcript shows that we did not object to the sale, only that we complained that "the takeover will leave the HPS with less likelihood of recovering its deficit" and asked the judge "to refuse to sanction the scheme" (§26). When asked to consider if we wanted "an adjournment to seek legal advice, Dr Colombi declined to ask for an adjournment...". This was because we did not object to the takeover per se, or to jeopardize jobs at Halcrow, only for a change to the scheme of arrangement. We had told Peter Gammie of this request before the hearing to allow time for an alternative arrangement to be agreed.

[michael tordoff]

What thoughts am I left with after the Roadshow?:
1.   CH2 spin and propaganda.
2.   HPA not treated fairly as being the only organised body in existence that seriously fights for the rights of HPS beneficiaries.
3.   CH2 are frightened about the prospect of HPS members acting collectively to challenge their position.
4.   Pensioners talked down to and belittled.
5.   Why are contractual obligations to pay pensions taken less seriously than obligations under the same contract to pay salary?
6.   Trustees are company appointments, not people elected by the people that count – the members of HPS and in particular members of HPA.
7.   Trustees try to justify HPS2, but trustees have not over the years fought hard enough to prevent the size of hole in the fund increasing. 
8.   Hardly surprising as trustees are dictated to by CH2, as evidenced by Chairman of the Trustees not being the trustee sitting at main table.
9.   JLT should have led the roadshow as independent arbitrator between the two side of the debate (company and beneficiaries), but CH2 were clearly dictating affairs.
10.   We are told that CH2 parent have no obligation to support the pension fund, but that contention has not (yet?) been  challenged in court.
11.   It is propaganda to present HPS members with the difficulty of having to fill a big hole in the fund when in reality the hole should have been filled every year and not allowed to grow.
12.   Trustees should have demanded that any shortage of funds be filled immediately, but their concern was to protect the company from running into financial difficulties.    In other words they were more concerned about the position of shareholders than they were about the rights of pensioners.  For HPS Trustees pensioners must come first.
13.   The spin presented is that exactly the same pension terms will continue under HPS2 as under HPS1, but "with slight reduction in the inflation element".  In reality the great majority of most pensions under HPS2 will attract zero increase.
14.   It is the percentage increase that is the crucial problem.  As things have worked out the 5% increases have proved to be unrealistic as related to actual inflation.  However, under HPS2 zero increases on the greater portion of pensions will be even more unrealistic if inflation rises to levels experienced in the 1980s.
15.   The "generous" uplift of 1% to 2.5% on joining HPS2 is actually no more than existing entitlement, since there should be a 5% increase each year and we are already half way towards the next increase.

[Clive Williams]

At the Bristol event we were told around 1000 had signed up for HPS2 and 40 for PPF.

We were told that the slides would not be made available because certain people were liable to make mischief with them, even though there was nothing on them what wasn't already published

[ericc]

In the midst of all this uncertainty is there any assurance that if HPS2 fails that members of the new scheme are still protected by the PPF (as we are with the existing HPS?)

[Clive Williams]

Yes, HPS2 will be covered by PPF, it does tell you somewhere in the literature you received.

[ericc]

thanks Clive

[meelit]

I believe the Pensions Regulator has written to HPA on 24 June 2016 following their meeting on 20 June explaining their position. This letter is also on the Halcrow Pensions website. Does this explanation satisfy our legal experts? There are some crucial statements in there about  CH2 not having any legal obligations to fund the scheme and why they approved using the RAA.
Where do we stand on this as it puts a different slant to the argument.

[meelit]

I rang JLT to ask for a copy of the presentation as I am overseas and unable to attend any of the roadshows. They said they would pass on my request to the Pensions Team.


I rang the Pensions Team as well and was told that a copy of the presentation slides was unavailable as the roadshow was a mix of presentations and talks (??). I fail to see why a copy of the slides cannot be made available for those of us who were unable to attend.


I was also told that a summary of questions and answers from the roadshows would be sent out to all soon.

[Jane Tordoff]

Meelit are you able to provide me with a personal email address.  Mine is on the forum.

[finneyb]

However, I would expect that not many people will ever reach this cap other than highly paid senior ex-Halcrow staff (already drawing their pension) who may already be over the cap and would therefore receive an immediate pension cut if they entered the PPF. So it appears that it is in the interests of those people to opt for HPS2.

The PPF cap only applies to those who have not reached scheme normal retirement age before entering PPF. 
If you are below normal scheme retirement age  eg a current Halcrow/CH2  employee you will receive a 10% cut in your pension on entering PPF and also the cap applied to the larger pensions;  this group includes existing staff.

This is why HPS2 has been offered -  it prevents existing staff getting a 10% pension cut on entering PPF and also the cap applying to the larger pensions of existing staff. Existing staff are valued - they earn fees - pensioners are there to be walked over !   

[tonybird1946]

I understand that there is one HPS2 benefit that is not available in PPF.

The partners/widow's pension is based on the pension entitlement on the day of retirement plus increases and not the pension in payment at the time of death. Thus if you took a lump sum at retirement the surviving spouse pension disregards this. The existing HPS has the same conditions relating to the surviving spouse.

[PhilipAlexander]

On the issue of whether HPS2 can enter the PPF at some later stage, raised by Eric Cooper( hello Eric), the correspondence we have received is ambiguous, not definitive. I have asked the Pensions team to present, clear, unambiguous and definitive clarification in the form of a guarantee in writing from the PPF or pensions regulator that HPS 2 WILL be able to enter the PPF if necessary. This was several weeks ago but still no reply. The correspondence to date merely states that it is ELIGIBLE to enter the PPF. I am sure that any contracts specialist worth his salt would be able to draw the distinction in law between ELIGIBLE and WILL BE ABLE, Where's Colin Reed to assist please? And will HPA please devote some of its resources to getting the pensions team to answer this simple question. After all, despite all the huffing and puffing, it is likely that we'll be left with only the two choices we have at the moment. And for pensioners HPS2 is better than PPF but only if it has the benefit of the PPF lifeboat.