Threat to Appledore pensions

MORE than 500 workers at the Appledore Shipyard in north Devon are threatened with the loss of a large chunk of their pensions.

The latest crisis comes as the Government works on plans to protect employees who lose out through no fault of their own when pension schemes are wound up with a deficit.

Union officials said Appledore staff have been on reduced pay for weeks and are now facing a 'redundancy catastrophe'.

It is feared that those in the firm's final-salary pension scheme could also lose up to 80% of their pension rights.

Receivers from Tenon Recovery went into the company - Britain's oldest commercial shipbuilder - after it ran up losses of up to £250,000 a week.

In 2001, the latest accounts available, the £21m pension fund had a deficit under FRS17 accounting rules of almost £1.3m. Markets have fallen sharply since.

The final-salary fund is closed to new members, with recent staff being offered a stock market linked scheme instead.

Appledore was forced in 2001 to set aside a £936,000 provision for future funding of its main final salary scheme.

Thousands of companies have gone under with a shortfall in their funds - leaving workers with much less than they expected - including steel group ASW and shelving maker Dexion.

Protesters formerly employed by these two firms yesterday staged a 'Full Monty' stunt on the beach at Bournemouth, where the Labour Party is holding its annual conference.

The demonstrators claim they have been 'stripped' of their retirement nest eggs. They hope to put pressure on Prime Minister Tony Blair to provide compensation.

Malcolm McLean, of the Occupational Pensions Advisory Service, said: 'We have seen this happen over and over again. Most schemes are underfunded at the moment because of poor stock markets. If a company goes under, it is a massive problem because there is no-one there to fund the deficit.'