Too expensive to tell you – the DWP cover up on whether they are really compensating millions who lost out on a Guaranteed Minimum Pension

The Department for Works and Pensions has compounded the big scandal over millions of people who are entitled to compensation for the ministry’s hidden decision to scrap an annual increase worth anything up to £27,000 over the lifetime of a pension for those, particularly women, who were contracted out of Serps by private companies.

Previous blogs highlighted this scandal after the Parliamentary Ombudsman ruled that there was maladministration in not telling millions of people that they would lose out when the new state pension was introduced in 2016. Only two people were compensated with sums of £500 and £750.

But the Ombudsman wimped out in enforcing the compensation for millions by allowing the DWP two years to take action to compensate people and then allowing them to create a factsheet which didn’t tell the full story.

Suspicious that the DWP was still avoiding to do anything a campaigner on this issue, Chris Thompson, put in a freedom of information request to the DWP to find out how many people have asked to be compensated,

The answer has now come back. The DWP said:

We can confirm that we hold information falling within the description specified in your request. However, we estimate that the cost of locating, retrieving and extracting the information for these requests, when aggregated, would exceed the appropriate limit of £600. The appropriate limit has been specified in regulations and for central Government it is set at £600. This represents the estimated cost of one person spending 3½ working days in determining whether the Department holds the information, and locating, retrieving and extracting the information.”

This was only asking about emails and letters the ministry had received since August 12 this year – a matter of a few weeks- it is rather suspicious if not laughable that this would take more than 3.5 days to find out. Surely the department would have a simple database to do a computer search.

Suspicion that nobody or few people have contacted the DWP

Mr Thompson suspects there is another reason.

” I think the reason the DWP don’t want to give me the information is that no one has contacted them or only a few which would show up by putting it on GOV.UK so that people only find out by happenchance which is not very satisfactory. For GOV UK to be a suitable way for people to find out about loss of GMP indexation then a majority of the 11 million people should see it. I wonder if they did any sort of assessment to find out how many people they thought  would find the fact sheet on the GOV.UK website.”

Again this bodes badly should the women born in the 1950s and 1960s achieve compensation for maladministration over the up to six year delay in receiving their pensions when the age was increased from 60 to 66. It sounds like the government won’t be very helpful in telling people how many were compensated.

However they may be another way to get hold of what is happening or rather what is not happening.

Stephen Timms MP to press DWP over numbers

Following some lobbying by Mr Thompson and myself Stephen Timms, the Labour chair of the Commons works and pensions committee, plans to tackle the government over this omission.

He has been promised a six month review by the ministry on how the use of the factsheet is working.

He told us that he intends to write to the ministry in December demanding that as part of the review they disclose how many people have applied for compensation.

This means whether they like it or not the DWP will have to spend some money and time finding out – unless they are going to tell Mr Timms that it is too expensive to do the exercise. We shall wait and see but for some of the people who don’t know they are entitled to this money – it could be a matter of life and death – as they may already be in bad health and could die before they realise.

Previous blogs on this:

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HS2: The train going nowhere

Boris Johnson loves mad grandiose building projects ( remember the third London airport in the Thames Estuary) and more recently a tunnel/bridge under the Irish sea from Scotland to Northern Ireland.

Picturew of the design for the first HS2 trains

But what is emerging is that that even the most basic grandiose project -London’s Crossrail link and the high speed railway from London to Birmingham can’t be built on time to cost or even properly completed. A failure to integrate Crossrail with the rest of the railway system and continual cost rises for HS2 are the main reasons for delays.

MPs on the House of Commons Public Accounts Committee last week achieved one first – getting HS2 to provide some proper figures on the real costs. The entire HS2 project – if ever built from London to Scotland – will be £98 billion if not more. The first phase from London to Birmingham now has a budget of £44.6 billion – of which £11 billion has already been spent but we won’t see any results for the travelling public until 2029 at the earliest if not 2032. And probably in reality even later.

What is more disturbing is that service will initially run only from Birmingham to Old Oak Common in west London -not to London Euston where it can connect with other services.

Whitehall still quarrelling over the plans

Worse still internal Whitehall quarrelling means that they haven’t even fixed the most crucial arrangement – what will the Euston terminus look like.

“The redevelopment of Euston station is currently estimated to cost £2.6 billion. Despite HS2 Ltd telling us last year that the design of the station was ready for planning consent, the Department has spent the past 15 months looking for cost saving options and efficiency opportunities, including the potential for a smaller station.

” HS2 Ltd asserts that it is getting close to the point where the programme will literally run out of time if a decision is not made soon, and that Old Oak Common is being set as the London terminus when the railway first opens to decouple it from the risks at Euston.”

Gigantic building site at Euston. Pic credit: Global Railway Review

This is an extraordinary situation. It is made much worse because the area around Euston Station is now one gigantic building site after homes, shops and private businesses that border onto the existing station were demolished. And people living next to the site are being moved because of the noise and dust. And all for a new terminus whose configuration has still to be determined by the Department of Transport and which could be smaller than currently planned.

Further up the line there are disputes involving the land they are purchasing, environmental damage and pollution problems created by the development.

Volume of complaints rising

The MPs report: “We are already concerned about the volume of complaints on disruption from the programme which does not bode well for the future as more communities will be impacted as construction progresses. HS2 Ltd estimates it has handled 124,000 queries over the past three years and interacted with over 76,000 people along the route.

….”the number of complaints from the public about High Speed 2 has increased as main construction on Phase One has started. Complaints to the Independent Construction Commissioner HS2 rose to 86 in the first quarter of 2021 from 74 in the previous quarter. The majority of complaints are about the impact of construction on roads and traffic, vegetation clearance and about noise and vibration. Due to the scale of the programme and the time until the railway is complete, complaints are likely to increase.”

As part of its ” levelling up ” programme the government has promised to reskill the nation so people can get jobs as part of the regeneration of Britain post Brexit. Yet again the MPs point to further failures. The much trumpeted National College for High Speed Rail was a failure in attracting students and has had to be renamed the National College for Advanced Transport & Infrastructure and, most recently, merged with the University of Birmingham.

The MPs report: “The Department admits that the performance of the college has been disappointing and hopes that its latest merger, new leadership and new curriculum from September 2021 will be an opportunity to get the best out of the arrangement. Yet the Department’s involvement with the college has been limited as it falls under the Department for Education’s accountability remit.”

As for extending the railway to Scotland via Leeds and Sheffield that is in doubt and could be scaled back to Crewe. This has been partly confirmed by Grant Shapps, the transport secretary, who in an interview yesterday with the Financial Times has cast doubt on whether the line from Birmingham to Leeds along the eastern side of England will ever be built – hinting that other projects may have priority.

We want to make sure we get trains to Leeds in a way that actually benefits people on the network and not blindly follow some plan invented 15 to 20 years ago which no longer benefits people.” he said.

This completely contradicts what he said only in May when he promised the government would “complete HS2 and include HS2 on the eastern leg to Leeds”. All this suggests that costs must be mounting up with another U turn in prospect.

If this is levelling up – it is farcical

So what do we have here? An extremely expensive part built railway that may not even initially link Birmingham and central London beset with issues and aeons away from the dream of a high speed line linking Scotland with central London.

If this is to be an example of ” levelling up ” Britain it is just farcical. Meanwhile in the European Union we left the high speed train network goes from strength to strength with new lines and a sleeper train network planned that will reduce the need for air travel – all part financed by British train customers as most of the companies running our train services are owned by state rail companies based in the EU.

Our new high speed train system is going nowhere soon and causing nothing but pain and disruption.

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Bad news for fighting Climate Change: How Whitehall bungled first Green home insulation scheme

Sarah Munby, permanent secretary, BEIS, clearly not to up to the job over this

In a few weeks time Britain will be playing a pivotal role by hosting the Cop 26 international climate change conference in Glasgow.

Tight targets are going to be set which if not met will mean even more dramatic weather catastrophes than we are seeing now as the planet warms up.

So is Whitehall up to the job? If one takes the first example of action to save energy the answer is a resounding no.

A damning National Audit Office reveals an extraordinary poor performance by BEIS – the business and energy ministry – in getting 600,000 homes – mainly owned by low income families updated with new home insulation to cut their fuel bills and save energy.

The Treasury had earmarked £1.5 billion. The ministry ended up spending only £314 million. Its 600,000 homes target was missed by over 550,000. The administration costs were astronomical – for a scheme that provided grants of up to £5000 or £10,000 for low income income families – it cost over £1000 per house. Instead of of 600,000 saving up to £600 a year in fuel bills – only 47,500 will benefit.

And it should have provided a much needed job boost providing work for 82,500 people during a time when work was in short supply Instead it created just 5,600 jobs before the scheme was closed down last March.

Worse still both customers and contractors were badly treated. Delays paying contractors and customers getting their vouchers led to over 3000 complaints.

Why Sarah Munby is to blame for this fiasco

Who is to blame for such a mess? The answer must lie with the permanent secretary, Sarah Mundy. She is supposed to be this new business friendly appointment bought into government by the Tories to shake up Whitehall. Her biog on the gov.uk website said: “Sarah joined BEIS in July 2019 as Director General, Business Sectors. Before that, Sarah worked at Mckinsey, where she led their Strategy and Corporate Finance practice in the UK and Ireland.

“She has worked with some of the UK’s largest companies to change their strategic direction, and led much of McKinsey’s work on productivity across the UK economy.”

But she in no way lived up to her billing. To be fair HM Treasury gave the Department an over-ambitious 12-week timescale to design the scheme, consult with stakeholders and procure an administrator.

This came at a time when the Department was supporting vaccine procurement, and undertaking activities related to EU Exit. The Department accepted that delivering the scheme within this timescale posed a high risk, but judged it was justified by the need to support businesses in the wake of the COVID-19 pandemic.

A US global company’s cheapskate bid

But it is at the back of the NAO report that her real failings show up. She was obviously entranced by business to use a new state of the art digital voucher system and gave the contract to ICF, a US global consulting and technology company, based in Fairfax, Virginia. The report reveals they put in a cheapskate bid. Their technology was not up to the job as shown by repeated reviews of failures in the digital voucher scheme. This led to the scheme having to managed manually- which is why it cost £1000 per house.

The NAO said: “ICF’s proposed costs for the development of the digital solution were less than half that of the second cheapest bidder, triggering the need for a review under government contracting guidance. The Cabinet Office review concluded there was not enough information within the bids to understand specific costs, and thus whether any adjustment should be made for a low bid.”

But it came back to Sarah Munby. She ignored the Cabinet Office. Having chosen the contractor she was then warned by every single contractor asked to undertake the work that it couldn’t be done in time. But she still went ahead.

Whitehall sceptics ignored

And the same came from inside Whitehall. The Department presented the Scheme’s full business case to its Project and Investment Committee on the 28 September, ahead of the Scheme’s final approval for launch on 30 September last year. The Committee decided not to approve the full business case, raising concerns that the digital systems for the Scheme were not yet fully developed and tested. They were right but still she ignored them and went ahead. Within six months it had to be abandoned and it is largely her fault. As a result hundreds of thousands low income families have lost the chance of cutting their energy bills this winter.

One can only agree with the verdict of Meg Hillier, chair of the Commons Public Accounts Committee.

“The Green Homes Grant scheme was set up to fail, with an undeliverable timetable and overly complex design which took little account of supplier and homeowners’ needs….

Government cannot hope to achieve its net zero ambitions if it doesn’t learn the lessons from this botched scheme.”

Marks and Spencer shamed: Sunday Mirror follows through my story of the 85 year old given a lifetime shopping ban

Sunday Mirror story on Patricia Stewart

Following my story on this blog on August 5 on the outrageous life time shopping ban given to a 85 year old Covid shielding woman by Marks and Spencer I decided it deserved wider publicity.

So I contacted the Sunday Mirror and I am delighted to say today’s paper includes a report of the incident and the ban.

Marks and Spencer did adopt an incredibly arrogant attitude in refusing to comment to me on why they justified the ban by ignoring my request as a journalist to the press office. I noticed when the Mirror rang they had to give a one line statement saying ” They cannot discuss individual cases. Excluding a customer is only done in rare circumstances.”

Patricia Stewart

As I said in my previous blog Patricia Stewart was obviously confused going round their Bexleyheath store and left her shopping there. The manager and his colleague who followed her out of the store and searched her shopping bag then seized on a pair of Brazilian knickers without a receipt and ” presumed” it was stolen. This evidently is enough for M&S to ban her for life shopping with M&S ever again. Her explanation is that she intended to get them exchanged as they were a gift from a friend but she had forgotten to bring the receipt.

Trespass Orders

I also notice they won’t tell the Mirror how they enforce the ban. From a trial run by her relatives where she ordered stuff directly on line and visited three other M&S stores away from Bexleyheath, it looks like to me as meaningless outside Bexleyheath. There is an interesting thread here on the Legal Beagles website -which describes someone else being banned at M&S in Harrow, north London. The ban covered ” unusual behaviour”.

You can see from it the person got really worried. M&S seem to take a rather overbearing attitude to some of their customers. Either they should prosecute if it is shoplifting or offer to help if someone is confused

Exclusive: How Marks and Spencer banned this 85 year old Covid shielding woman from shopping with them for life

Patricia Stewart

This is Patricia Stewart an 85 year old woman. She spent the first five months of the lockdown shielding from Covid 19 as she is a vulnerable person. Last autumn during the period when the first lockdown was lifted she ventured out to shop for the first time. As a M&S customer for over 60 years she went to her favourite branch in Bexleyheath shopping mall. What happened next is hardly believable but raises a lot of civil liberties issues.

Patricia Stewart was nervous about going round a public store for the first time. She went to the customer services desk and exchanged a babywear item for a bra. She then went round the food hall but being worried about Covid starting putting packaged food items into plastic bags. This attracted the attention of a security guard who told her not to do this.

According to details released by M&S following a subject access request by her relatives he ” deemed it as shoplifting “. She was then followed by a male manager and female colleagues. Now feeling thoroughly uncomfortable she approached the till four times and then changed her mind and decided to leave the trolley full of shopping and go out of the store.

M&S Brazilian knickers- a smoking gun?

She was followed into the shopping mall by the manager and a female colleague and while she was sitting on a bench waiting for a taxi they challenged her in public and demanded her name and address She refused to give it to them so they proceeded to search her shopping bag. They found none of the food shopping but did discover a pair of M&S Brazilian knickers without a receipt. They claimed they had been watching her on CCTV and saw her change a label adding that a customer had also complained about her.

Marks and Spencer store in Bexleyheath. Pic credit: M&S Facebook page

They then proceeded to serve her with a ” trespass order” – a device used by many stores to keep out suspect shoplifters without going to court – not only from the Bexleyheath store but from any store in the country and on purchasing anything from M&S on line for the rest of their life.

The ban has been challenged by her two daughters who asked to see the CCTV and for evidence of the other customer’s complaint. When challenged M&S couldn’t provide the CCTV to prove their allegation because according to them ” it wasn’t recording properly”. Nor could they produce the customer who complained.

But M&S stuck to their story and have now ended any correspondence with them -pointing out they are not regulated by anybody and therefore nothing else can be done.

Steve Rowe, chief executive, Marks and Spencer

I decided to investigate this and approached M&S Corporate Press for comment. Six weeks after failing to reply to me I escalated my inquiry to Steve Rowe, chief executive of M&S, who has ignored my email. Therefore I can’t put their response.

There are two issues here which are connected. First of all the particular case and the use of trespass orders and secondly how they can be enforced. The retailer is allowed to use them because their store is private property. A search on the internet reveals they could be quite common – for example someone complained in Bristol about being banned by M&S. And nobody knows how they can be enforced – one theory which sounds too fanciful to me – is that M&S are secretly using facial recognition cameras in their stores. The other is that the M&S Sparks card – both offers you treats but is used as a surveillance card to monitor customers. Since M&S would not respond to my questions all this is speculation.

The Sparks card was used by M&S in this case as proof of her not purchasing the knickers – they revealed in an email that they have records of many of her purchases going back two years but insisted they had no personal file on her. But according to her the knickers were purchased by a friend as a gift – so they wouldn’t be on her purchase list.

Failing to get a reply from M&S the relatives and I decided that we could test out the ban. First she decided to order a bra on line without using a Sparks card – and guess what she received a cheery note from the company telling them it was on its way and it was delivered last month. (see above)

She has since then shopped in three other M&S stores without any problem but has not returned to Bexleyheath.

This raises the question whether these ” trespass orders” can really be enforced or just used to intimidate people believing they can be banned. I would certainly have thought they would have to have an elaborate system to enforce them nationwide – that might be challenged by GDPR.

The other matter is a civil liberties issue – from what I have got from the subject access request – M&S would have had a flimsy case if they went to court. So why should they be judge and jury in deciding people’s individual liberties?

Tufail Ahmed, general manager of the Bexleyheath store. The store is the South East London Academy store, leading business initiatives and educating store teams across the region

According to their memos M&S believe their staff behaved with ” integrity” in banning her. Tufail Ahmed, the manager of the Bexleyheath store, who must be locally responsible for this, has a Linked In page in which he says:

 “M&S Manager of the Year 2018/2019. With nearly 20 years of retail experience working for leading retailers in various roles, I know that change is a very normal place in retail. I am now part of the change at M&S, leading and inspiring people to be the very best.

” My long term aim is to be an influential member of a business’ senior leadership team, that is what I am currently working towards.”

I suspect relatives of Patricia Stewart might beg to disagree.

As for Steve Rowe, who has built his entire career with M&S, his silence on the matter is deafening. He looks about the age to have elderly relatives, I wonder if he would like them to be treated like Patricia Stewart.

Nuclear industry leaders contradict each other in landmark whistleblowing case

Whisteblower Alison McDermott

Guest Blog from journalist Philip Whiteley who is covering the whistleblowing case with me

A split emerged between two leading employers in the UK nuclear industry at Leeds Employment Tribunal, in a case where they are both respondents in a whistleblowing claim, in the session on Tuesday 29 June. Representatives of the governing body the Nuclear Decommissioning Authority overwhelmingly backed the version of events put forward by the whistleblower, undermining the defence of Sellafield, the nuclear reprocessing plant.

The case is being brought by Alison McDermott, an experienced equalities professional, who is claiming her sudden termination of contract by Sellafield in October 2018 was in response to her making protected disclosures on acts of bullying at the nuclear reprocessing site in Cumbria. Sellafield’s management initially claimed that the reason for her dismissal was financial only, although at the tribunal it has produced witnesses reporting concerns over her performance.

On Tuesday three senior executives from the governing body, the Nuclear Decommissioning Authority, offered sharply contrasting evidence. All expressed admiration for Ms McDermott’s contribution to improving policies of equality diversion and inclusion (EDI), and all confirmed that there had been concerns over the competence of the HR director who sacked her, Heather Roberts, and the HR function at the nuclear site.

Sellafield Human Resources department ” not fit for purpose”

All said the reason they were given for Ms McDermott’s dismissal was financial. David Vineall, Group HR director at the NDA, said that Ms McDermott had been integral to the EDI ‘journey’ that the industry was embarking on. Under questioning from Ms McDermott’s barrister James Arnold, Mr Vineall conceded that the HR function at Sellafield was ‘not fit for purpose’, the words used in a damning report he had commissioned by external consultancy PricewaterhouseCoopers.

The court heard how the governing body had recommended that Ms Roberts be replaced by Mike Barber, an HR manager at the NDA. Mr Barber, one of the witnesses for the NDA on Tuesday, said he had ‘a very good working relationship with Ms McDermott’ and was ‘surprised’ to hear of her sudden dismissal.

Some of the most damning evidence undermining Sellafield’s case only came to the court’s attention in recent weeks. Mr Arnold pointed to the date of 26 April 2021 when the claimant first learned of an email from 23 October 2018, just a few days before Ms McDermott learned of her dismissal, in which Mr Vineall wrote to colleagues following a meeting with the then Sellafield CEO Paul Foster the day before, where he suggested that Ms Roberts be replaced immediately.

Nuclear Decommissioning Authority ” very nervous” about Ms McDermott’s dismissal

Just last week, the tribunal heard for the first time evidence from Ms Roberts that she had a made a note stating that the NDA was ‘very nervous’ about the timing of Ms McDermott’s dismissal so soon after her critical report.

The revelation that the respondents had hidden evidence from the claimant and the tribunal that was helpful to her case until this year is particularly significant, because there were earlier hearings in the case. There was a preliminary hearing in July 2019, and Ms McDermott had been granted a strike-out hearing, on the basis that her case was strong.

The strike-out hearing took place on 7 July 2020, some nine months before the revelation of Mr Vineall’s email, and 11 months before more evidence from Ms Roberts, also central to the case, was made available during the hearing itself. Judge Lancaster did not rebuke the respondents for this, but it potentially constitutes a breach of tribunal rules by the respondents, as well as a potential breach of whistleblowing legislation, as it potentially caused detriment to the claimant.

Had Judge Batten, sitting alone last July, been made aware of all the relevant evidence, she may have awarded a strike-out in Ms McDermott’s favour, sparing her the ordeal of a further year of litigation and a three-week full hearing.

Section 47 (A) of the Public Interest Disclosure Act 1998, under which the case is being brought, specifically prohibits employers from imposing a detriment on a whistleblower as retaliation for raising issues of concern in the workplace.

Mr Arnold reminded the court that much of the evidence has only been made available to the tribunal as a result of the claimant’s own efforts through subject access requests and Freedom of Information requests. This would indicate a strong claim of failure to follow tribunal rules – potentially a criminal offence by the respondents – though Mr Arnold did not press the case.

Ms McDermott’s data protection rights breached by Sellafield

Sellafield already has a ruling against it in the case. In January, the Information Commissioner’s Office ruled that it had breached Ms McDermott’s data protection rights in the handling of three letters of evidence on which Sellafield is relying to support its case in the tribunal over her performance issues. The letters were produced on non-secure home PCs. The tribunal has permitted Sellafield to use unlawfully produced evidence.

On one of the letters, the metadata was wiped while in possession of DLA Piper, Sellafield’s law firm, temporarily hiding details on the document’s authorship and time of creation. The law firm is separately under investigation by the Solicitors Regulation Authority over the issue.

The case continues.

Book review: Home Truths and the disaster facing the Tory Party if it can’t help Generation Rent

Liam Halligan Pic credit: Twitter

This is a humdinger of a book. Its author Liam Halligan – a cerebral Brexiteer rather than a flag waving, Rule Britannia supporter – exposes and then tries to solve – the biggest crisis facing the younger generation. They either can’t afford to buy their own home or haven’t a hope in hell if they are poor in getting social housing.

The huge hype in house and land prices – which is still going on despite the pandemic – is exposed in this book as part of deliberate policy by landowners and an oligopoly of huge house builders – to maximise profits, provide sub standard new homes and prevent any changes in planning laws which would release land for housing.

The government is committed to ” build, build, build” hundreds of thousands of new homes for the young generation who increasingly are having wait until they are 40, if they are lucky, to own their own home. Like many political promises this is unlikely to materialise under present government policies and he explains in graphic detail why this will not work.

Instead by subsidising buyers under the Help to Buy scheme they are fueling house price rises and only helping the better off – who also get help from the Bank of Mum and Dad – to acquire a home.

Home Truths book

This well researched book shows that Attlee’s government had the idea of how to both build a lot of council housing and incentivise builders to expand home ownership. But both aims have been destroyed by successive governments -including the error under Tony Blair and Gordon Brown – not to build any council houses.

The current Tory promise is undermined by the fact – exposed in the book – that the party is hamstrung by its donors – many of whom are committed to making more money by keeping house prices high and building land rationed. The big builders have also gobbled up many of the small builders – the very people who have incentives to build homes fast – to strengthen their monopoly.

The result was in 2017 that Jeremy Corbyn garnered votes from the young frustrated at having to eke out of their lives in either overpriced rent sharing properties or stay at home with mum and dad while they were in their 30s. Now without Jeremy Corbyn around to scare the Tories, the government might think they can still get away with it.

Ian Mulheirn Pic credit: Institute for Global Change

Labour need to step up to this problem. They are not financed by landowners. One thing they shouldn’t do is take any notice of the Tony Blair Institute. The former PM’s chief policy maker actually believes there is no housing shortage. Ian Mulheirn is using Blair’s platform to peddle the idea and argue that we should not build hundreds of thousands of new homes. Presumably he is happy for the young to pay ever increasing rents or stay with their parents., The big builders and private landlords must love him.

What is good about this book is that the author also proposes solutions which are pretty radical and involve a major reform of planning legislation ,changes to the value of land and penalties for builders who just hang on to sites. And a major social housing programme as well. Well worth a read. If the Tories don’t act they risk alienating a whole generation.

Electoral rolls falling and Millennials head for Spain

I have added a couple of my own blogs that illustrate the results that the author hasn’t mentioned. One shows the declining electorate in central London because so many properties are going to overseas buyers and are used as AirBnB’s. The others show that if we are not careful this permanently rising market could be used for property developers to take over the care home market. The third is a very recent article in the i paper showing that the millennials are voting with their feet and helping fuel a Spanish property boom. Talented tech savvy young Brits are finding you can rent a whole villa in Marbella for the price of a crummy flat share in London and they are basing themselves there. The country is starting to lose vital young talent.

https://bylinetimes.com/2019/12/05/zombie-neighbourhoods-londons-disappearing-voters/

https://davidhencke.com/2021/03/15/how-the-genteel-retiree-world-of-centenarians-was-shattered-by-the-ruthless-modern-model-of-social-care-capitalism/

https://inews.co.uk/news/uk/costa-del-covid-millennials-swap-uk-drizzle-work-remotely-spain-gain-post-brexit-rights-1003386

The Pensions Regulator: The most unwanted job in the government

Hidden husband and wife conflict of interest revealed for winning candidate

Last week almost unreported MPs on the Commons Work and Pensions Committee approved the appointment of a new chair of the Pensions Regulator. It went to Sarah Smart -already the interim chair.

Nothing particularly newsworthy in that. But the report from MPs went on to disclose the dearth of interest in this important job and expose until now a hitherto hidden serious conflict of interest that affects the entire board of the Pensions Regulator.

The regulation of private pensions in the private sector affects tens of millions of people. As the report says:

Its main responsibilities include:
a) Ensuring that employers put their staff into a pension scheme (known as
automatic enrolment) and pay money into the scheme;
b) Protecting people’s savings in workplace pension schemes;
c) Improving the way that workplace pension schemes are run;
d) Ensuring that employers balance the needs of their pension scheme with growing
their business;
e) Reducing the risk of pension schemes ending up in the Pension Protection Fund,
a statutory fund which protects members of defined benefit pension schemes if
their scheme becomes insolvent.

Pension scams

It also pays a role in keeping an eye on pension scams and firms going bust leaving people without proper pensions. The MPs say they have previously been concerned about its role in some high profile cases involving defined benefit schemes whose sponsoring employer had become insolvent. ” We ourselves have expressed concern this year about
TPR’s capacity—working alongside other regulators—to tackle pension scams effectively.” These cases include tax exile Sir Philip Green’s treatment of the British Home Stores Pension Fund and the British Steel pension fund.

Therefore it is rather shocking to discover that this £75,000 a year part time job for the public face of the Pensions Regulator attracted just eight applicants – and that was after extending the application period. Three were not worth interviewing. Of the remaining five who were interviewed – three were thought to be inappropriate for the job. This left the choice of just two people – Sarah Smart and another.

Indeed so low were the number of applications that the Department for Work and Pensions can’t provide a breakdown of the gender, disability and ethnicity of the applicants – for fear that it will end up disclosing who applied.

Fraser Smart -chief executive of BA Pensions – conflict of interest with his wife’s new appointment Pic credit: Twitter

But worse was to follow. Sarah Smart’s application for the job disclosed that her husband Fraser Smart was chief executive of British Airways Pensions and chair of British Airways Pension Investment Management Ltd – the body responsible for investing the money of thousands of employees of the airline. The BA Pension scheme is one of the bodies Sarah Smart is supposed to supervise- an obvious conflict of interest with her husband as chief executive of a blue chip company pension scheme.

She has promised that her husband will resign his job before September and not take any other job involving managing a pension scheme.

It was then discovered that NONE of the members of the board of The Pensions Regulator have to declare whether their partners or close relatives run company pension schemes – which has forced a review of the code of conduct of the regulator.

Guy Opperman, pensions minister couldn’t even be bothered to meet Sarah Smart before he recommended her for the job Pic credit: Twitter

Ministerial interest in the running of the Pension Regulator is virtually non existent. Guy Opperman, the pensions minister, couldn’t be bothered even to meet the new chair before he appointed her. As the MPs say in their report:

“We were surprised to hear that Mrs Smart had not met the Pensions Minister before being chosen for this role. We urge them to arrange a meeting at the earliest possible opportunity.”

The MPs also fired a warning shot about the conflict of interest: “We are conscious, however, that—given wider economic uncertainty—her spouse’s situation may change. In that event, we would urge TPR, the Pensions Minister and Mrs Smart herself to consider whether she can remain in her role.”

Pension mis-selling: Lorry driver’s victory against private pension firm in landmark court decision

Royal Courts of Justice Pic Credit; Wikipedia

In 2012 Lorry Driver Russell Adams was down on his luck. His bank, the HSBC, had decided to call in his £170,000 mortgage on his £380,000 home. Desperate to raise money he thought of cashing in his frozen £52,000 private pension from Friends Life. He spotted an ad “‘release some cash from your pension” and was directed to CLP Brokers.

A friendly man called Ben Shepherd, told him “I could transfer it into a pension that would perform better and allow me to invest in better investments. I did not know much, if anything, about pension investment at the time and trusted what CLP told me.”

Since the transaction was going to be handled by a reputable private pension management provider then called Carey Pensions UK ( now Options UK Personal Pensions) he was reassured.

He was directed to invest in Store First, a Blackburn based storage facility, that made its money letting out what are known as store pods to people.

Mr Adams told the court that Ben was very keen on this because it was property and he made it sound safe and good for me. He then took out an execution only SIPP with Carey to include his investment. Ben was on commission for putting business that way.

What he didn’t know that CLP, based in Spain, was not authorised by UK law to give any financial advice. It was run by Terence Wright and Lesley Wright. Although Carey was unaware of this until May 2012, the Financial Conduct Authority had posted a warning notice in respect of Mr Wright in 2010. The notice warned that Mr Wright was not authorised under Financial Services and Markets Act to carry on a regulated activity in the United Kingdom, explaining that it believed that he “may be targeting UK customers via the firm Cash In Your Pension”.

Worse was to come. Store First was a dud – it hardly made a penny and Mr Adam’s investment was worthless.

So Mr Adams went to court. At the first hearing the judge found for the private pensions industry and exonerated Carey Pensions for any liability of managing an investment run by a guy barred from trading in the UK.

But last Thursday the Court of Appeal overturned much of the ruling saying Mr Adams was entitled to his money back plus compensation and furthermore Carey Pensions now Options UK Personal Pensions – could not escape liability by trying to blame Mr Adams for his own misfortune. The pension firm tried to appeal to the Supreme Court but were blocked by the judges.

Lady Justice Andrews: Pic credit: judiciary.com

The judgement has widespread implications. For a start some 580 other people had been advised to invest in the firm Store First and could claim their money back. The ruling also has wider implications in that your friendly private pension provider may well have to stop recommending you high risk investments by unregulated – or to be more frank- dodgy providers or risk the fate of Carey Pensions.

The judges in my view took the right decision. They said anymore with only £50,000 to invest is not a sophisticated investor and should be better protected than someone with a £1m to invest.

” Fresh opportunities for unscrupulous entities to target the gullible” -judge

Perhaps the comment from Lady Justice Andrews sums this up the best:

“As the unhappy history of the transfers of small personal pensions into SIPPs holding high risk investments related in that judgment illustrates, the liberalisation of the pension regime in 2006 brought with it fresh opportunities for unscrupulous entities to target the gullible, the greedy or the desperate.

“There is nothing to prevent a regulated SIPP provider such as Carey from accepting instructions from clients recommended to it by an unregulated person, and from doing so on an “execution only” basis. But the basis on which they contract with their clients will only go so far to protect them from liability. If they accept business from the likes of CLP, they run the risk of being exposed to liability under s.27 of the FSMA.”

The full case is here. There is also a report in the Financial Times here.

A toxic indictment of the bungled nuclear decommissioning mess that cost taxpayers millions

Steve Holliday: A damning report Pic Credit: Twitter

Report recommends a root and branch review of the National Decommissioning Authority

You have a right as a citizen to be kept safe from any dangerous pollution from the ageing 12 closed Magnox nuclear reactors and research stations in the UK. You would expect the organisation protecting us to hand out properly thought out contracts to do the job. The failure by the Nuclear Decommissioning Authority to organise a £6.6 billion contract to clean up properly cost taxpayers £97.5 million when rival companies who lost out successfully sued the agency forcing them to settle with them.

This month completely unnoticed by the national press Steve Holliday, the former chief executive of the National Grid, published a damning report on how the agency failed to do its job and the failure of its supervising body, the UKGI, to supervise it and the Department for Business, Energy and Industrial Strategy, to keep tabs on what was going on.

So frightened were former senior executives of the Nuclear Decommissioning Authority(NDA) of his inquiry report that they rushed to the High Court to try and get a judicial review to stop him ruining their reputations. They failed but delayed the report.

For the record they were John Clarke. the former NDA chief executive; Stephen Henwood, the former chairman; Robert Higgins, the former head of legal services; Mr Graeme Rankin, former head of competition and Mr Sean Balmer, former commercial director, He has spared their blushes by not naming them personally in his report.

Steve Holliday had in his remit the power to recommend disciplinary action against them for their failings. But he chose not to do so instead blaming the culture of isolation in the nuclear industry in general and the running of the Nuclear Decommissioning Authority in particular.

NDA failed to keep a grip

In broad terms the NDA failed to keep a grip on what has happening after they awarded the contract to the Texas company Cavendish Fluor Partnerships before it ended up in the courts where it was successfully challenged by rivals Energy Solutions and Bechtel. The original contract was changed so much and cost so much more – latest estimate is up to £8.9 billion that the companies who lost out were able to sue.

So imbued were the senior staff at the NDA with how clever they were in organising procurement contracts that they missed warning signs and worse didn’t inform the NDA board what was really going on until it was too late. The UKGI is revealed to have a conflicting role – both supervising it and sympathetically helping it sort out problems. He rightly suggests that it should be stripped of its day to day supervision.

The report says : “There appears to have been a culture that sought to self-justify, and which was inward looking. In particular: the NDA had a belief in its own skills and intellectual ability, and did not recognise or seriously contemplate that it may have any weaknesses, when contracting and managing external advisers, it had a propensity to limit their role, and did not appear to welcome strong challenge; and it failed to take sufficient steps to bring in people from other industries with different skills and experience, and to learn lessons from them.”

Damning conclusions picked up by a whistleblower

His criticism of the culture of the NDA has been picked up by Alison McDermott, a whistleblower taking the NDA and Sellafield to an employment tribunal, and may be quoted in her case expected later this year. The BBC recently did an exposure on bullying and harassment at Sellafield. The link to the story is here.

He recommends a root and branch review of the NDA by the business ministry- which has now handed the contract back in house – changing its structure and bringing in people from outside the nuclear industry and putting a top flight lawyer on the board.

I am worried that since there was so little publicity about this report whether the ministry will have the incentive to do anything about it. If it doesn’t we could see more waste of taxpayers’ money and we need changes for our safety in cleaning up some of the most toxic sites in the country.

Four years ago Sir Amyas Morse, then comptroller and auditor general , said “The NDA’s fundamental failures in the Magnox contract procurement raise serious questions about its understanding of procurement regulations; its ability to manage large, complex procurements; and why the errors detected by the High Court judgement were not identified earlier.”

We now need the National Audit Office and MPs on the House of Commons Public Accounts Committee to keep an eye on this. He also has wider recommendations for the rest of Whitehall when it hands out big contracts.

Bradwell Nuclear Power Station; Being decommissioned under this contract

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