'I can do nothing' says pension boss

SIR Geoffrey Whalen loves the Yorkshire Dales. So much so that he bought a delightful holiday cottage in the tranquil village of Helperby. And this weekend he was enjoying its rural charms during a fortnight's holiday.

All that peace and quiet will come in handy for Whalen, 68, one of only two British non-executive directors on the board of troubled American engineering giant Federal-Mogul, as he contemplates the retirement fate of an army of workers at the company's UK subsidiaries.

The 40,000 Federal-Mogul workers and pensioners are facing the biggest crisis to hit corporate pensions since the Maxwell scandal.

But Whelan has remained silent - until now. Financial Mail tracked down Whalen and his wife Charlotte. 'It's a dreadful situation', he said. 'It's easy for me to say this, but I do appreciate how awful it must be for workers and pensioners.'

That is an understatement. It was confirmed last month that the pension fund - under the name of the Turner & Newall car parts subsidiary - was on the verge of being wound up with a £900m shortfall. That would make it unlikely that UK workers would get more than half their pension entitlement.

And the company pension fund's problems have been compounded by Federal-Mogul's desperate attempt to get out of administration after being hit by multimillion pound asbestosis claims in America and Britain.

Federal-Mogul has offered to inject £65m into the UK pension fund. But the scheme's administrator says this is not enough. Unions plan to meet Carl Icahn, a key figure in the restructuring of Federal-Mogul, in New York on Tuesday in a bid to win better terms for T&N pensioners and workers.

As a scion of the British motor industry, Whalen will be hugely embarrassed by Federal-Mogul's pension crisis. He spent his working life in the West Midlands car industry, retiring in 1995 - the year he was knighted - as managing director of Coventry-based Peugeot.

Though he now lives in a £1m home in Abingdon, Oxfordshire, he maintains close connections with Coventry as chairman of the city's building society, where he draws a £54,000 salary.

Federal-Mogul is also a big employer in Coventry with its Sintered Products operation, employing 360 workers. It supplies valve seats and valve guides to all the world's big car manufacturers.

Unlike many T&N workers, Whalen enjoys a lucrative retirement.

He also gets £40,000 a year for sitting on the board of Novar, the former Caradon building materials group, and an undisclosed sum from privately owned car dealer Camden Motors, where he is a parttime-director. But his biggest earner is Federal-Mogul, where he is one of its most senior non-executives, receiving £70,000 a year. He joined the board in 1998 and sits on all four of its standing committees, including the one responsible for pensions. His duties also involve chairing the company's nominations and governance committee. And while T&N pensioners await their fate, Whalen has been closely involved in awarding Federal-Mogul bosses eye-watering pay packages.

Former president and chief executive Frank Macher received £2.1 million last year. And for the second successive year, his pay included a $1m (£550,000) 'retention payment', which Federal-Mogul claims is designed 'to incentivise him to remain employed with the company during its reorganisation proceedings'.

All told, five Federal-Mogul directors shared a staggering £1.95m in 'retention payments' in 2003. And it almost goes without saying that Federal-Mogul bosses can look forward to a comfortable dotage. For example, Wilhelm Schmelzer, the bearings boss with almost 35 years' service, is in line for an annual pension of at least £385,000.

'I'd like to see the whites of Sir Geoffrey Whalen's eyes,' said Jim Bimbi, a dayshift team leader at the Coventry plant on Friday. 'I'd bring along Ann Kerr with me. She has worked here as a valve inspector for 30 years and is worried sick that the pension she is due when she reaches 65 next year will not be paid.

'Maybe if Whalen saw at first hand the pain that was being caused to ordinary decent people like her, he'd take a greater interest in our concerns.'

Whalen, who draws a healthy pension from Peugeot, says the last time he discussed the pension scheme formally was on July 23, when he flew to Detroit for a regular Federal-Mogul board meeting.

Since then, Whalen has had no 'interim' phone briefings with fellow directors on the debacle, nor has he discussed the issue with the other UK-based non-executive director, Paul Lewis, former deputy chairman of sugar giant Tate & Lyle.

On Friday, Whalen, former president of the Society of Motor Manufacturers & Traders, said the fate of the T&N pension fund remained the board's 'primary concern'. But despite his seniority, Whalen claimed he was powerless to influence any decision on the pension fund's future.

'I've spent my life working in manufacturing,' he said. 'I know it's an absolutely desperate situation for those in the T&N pension scheme. My heart goes out to them, but I do not have the power to determine what happens.'

With those words, Whalen was gone, to enjoy the rest of his break in the Dales.