I am not a “first generation” pensioner but those who I admire & respect are. Hired in the 60s, they do not deserve this. Some have already passed and others are too aged to speak for themselves. We must speak for them. And BTW, the curve (see below) is the same for me/us. We have a little more time to force justice. The new government has a golden opportunity to demonstrate their values. They have the power! We gave it to them at the general election.
The minister has agreed to a meeting in December. It’s time to write to your MP again to tell him/her what we are asking for.
Declaration v 4c
HPE’s Pre 97 UK pension plan doesn’t do what it says on the tin for its pensioners who built the company.
The tin says “The main object of the Digital/HPE Pension Plan (check exact title) is to provide financial security to its members in retirement”. The only security the pension plan provides is guaranteed worsening hardship with no hope of relief.
After 19 years of deliberately choosing not to pay discretionary increases, the typical Digital/HPE Pre 1997 pension has lost approximately 70% of its value with an estimated loss of 75K£ to a typical pensioner over their retirement. This is the direct result of HPE’s pattern of governance decisions refusing increases to its Pre 1997 pensioners who have no other protection from inflation.
Our members have said (insert the actual quotes)
- I am in my 80s and must work to make ends meet.
- I worry every day about how my spouse will cope on 60% of this worthless pension once I am gone.
- I can’t afford to replace the windows on my house because of the poor value of my pension.
- I can no longer afford the pleasures I thought I had earned like a holiday.
- I can’t afford to get the help I need to live at home now that I am less mobile.
- I have had to sell my house to pay for the residential care of my spouse.
All pensions should be protected from inflation. And most are. UK public sector pensions and other countries across Europe have this protection. All UK pensions post 1997 have this protection.
But UK national laws do not require Pre 97 pensions to keep up with inflation, relying on companies to use discretionary increases to “do the right thing”. Many companies. “do the right thing”. In fact, it appears that more than 80% do the right thing. But some companies do not. And in our opinion, they pocket the money ethically due to their pensioners.
HPE promotes itself as “one of the world’s most ethical” companies. HPE annual net income for 2023 was $2.025B, a 133.29% increase from 2022. Yet nothing was given as a discretionary increase to their Pre 97 pensioners.
HPE’s repeatedly chooses not to share their profits with their UK pensioners while sharing it with shareholders and executives.
We know from the media reports that HPE is not alone. We know that at least 7 American headquartered companies behave the same way.
We want the government to take the following actions now. These actions build upon the Pension Select Committee’s report (insert link).
We want the Government to respond to the Work and Pensions Committee’s inquiry into DB pensions schemes, while at the same time, taking further supporting actions that can bring an end to this pension injustice now:
- Implement the Work and Pensions Select Committee Recommendations
Instruct The Pensions Regulator (TPR) to conduct the research to determine the scale and impact of the Pre-97 pension problem. This should include identifying the number of affected pensioners, assessing the financial consequences of zero discretionary increases, and evaluating the capacity of pension schemes to address these issues. The findings should be publicly reported within 12 months, ensuring transparency and enabling evidence-based policymaking. This initiative aligns with TPR’s statutory objectives to protect members’ benefits and promote good governance, addressing critical gaps in fairness for pre-1997 pensioners.
- Use the Power of Pensions Act 2021
Mandate that companies and Trustees, under the governance provisions of the Pension Act 2021, collaborate to develop strategies and policies that address discretionary pension increases for pre-1997 pensioners. These policies should align with pensioners’ reasonable expectations, such as inflation-based benchmarks, while ensuring long-term scheme affordability. Require transparent annual reporting on how increases are determined, with oversight from The Pensions Regulator, to ensure fairness and accountability. This initiative reflects companies’ ethical and social responsibility to support pensioners, particularly in schemes with a history of zero increases.
- Implement a Code of Ethical Practice
Implement a mandatory Code of Ethical Practice for pension schemes with pre-1997 members, aligned to Pensions Act 2021. This Code should outline principles of transparency, fairness, and accountability in managing discretionary pension increases. It should be accompanied by TPR ensuring adherence to the Code and be linked to government procurement decisions. Schemes should be required to publicly report on their compliance and actions taken to secure the financial stability of pre-1997 pensioners.
- Use the Government’s Purchasing Power
Use the government’s purchasing power and ethical procurement frameworks, including the Supplier Code of Conduct, to require companies bidding for public contracts to demonstrate how they secure the financial stability of pre-1997 pensioners. This should include transparent reporting on pension increases, as well as commitments to ensure long-term financial security for pensioners. Ensure independent oversight and regular reporting to relevant government bodies to guarantee accountability and compliance
In short, we call on the Government to end the pattern of zero discretionary increases now. We call for pension justice!
Letter below received from Work & Pensions Committee.
2 responses
I am now 77 years old and in the last few years have had the had frequent visits to the NHS. I have had great treatment, but every visit, when I see the amount of HP equipment being used, it sticks in my gullet why HP won’t pay their suffering pensioners the discresionery increases they deserve. This is probably duplicated in every NHS building throughout the country , which must be worth many millions of dollars to HP. I feel the government must be able to use this use this as leverage to help our cause. There will be a number of companies that would love to take on this contract.
I am now 87 years old and my wife is 82. Following two years National Service I worked in the computer industry all my working life, starting in 1960 at the ICT laboratories in Stevenage. From the start I was enrolled in the Company Pension Scheme, no opting out. I went on to work for two other companies, ending with Digital from 1979 thru 1993, in all cases transferring my pension. The DEC scheme even opted us out of GMP so our OAP has ended as the minimum. Since 2001 (HP year) my main pension, the pre-1988 bit, has remained exactly the same. My Company Pension income goes down every year as the OAP increase reduces my tax allowance. Thank David for the Triple Lock. Without it we would now be on the poverty line. But very soon, and certainly for my wife if I pre-decease her, life will get quite difficult and we shall have to start claiming State benefits. We would now be better off had I never paid into a Company scheme. Is this supposed to encourage the younger worker to join such schemes?? If companies are to be allowed to entice employees with offers of generous pensions then adequate legal cover must be included to ensure their promises can be honoured. Otherwise it is just common deception. HP!!!