MP cranks up pressure on tech giants in a bid to win pension 'justice' for 1500 Ayrshire employees

Ayr, Carrick and Cumnock SNP MP Allan Dorans
Ayr, Carrick and Cumnock SNP MP Allan Dorans -Credit:Allan Dorans

The MP for Ayr, Carrick and Cumnock, Allan Dorans, has lent his voice to calls for a fair pensions settlement for the former employees of UK Digital Equipment Corporation.

The firm employed around 1500 people across the region at their plant at Mosshill Industrial Estate, Ayr, between 1977 and 2002 - until it was wound down by new owners Hewlett Packard.

However, a long standing dispute has taken place between former employees and Hewlett Packard Enterprise over discretionary pension contributions. The former Digital employees claim they possess massively-reduced pensions from their pre-1997 contributions, because current legislation only index-links contributions from 1997.

And they want the tech giants to ‘make good’ on their contributions to the scheme. The group also has the backing of some other UK parliamentarians, who last month raised an Early Day Motion, calling on HP - and others - to make good on the pension contributions, which are discretionary.

In 1998, Digital Equipment merged with Compaq, and in 2001 that organisation, in turn, merged with Hewlett Packard. In 2017 Hewlett Packard split, and Hewlett Packard Enterprise took over responsibility for the Digital pension scheme.

Now SNP MP, Mr Dorans, has taken up the baton and spoken in Westminster during a debate on the issue.

He said: “I spoke in a debate in the House of Commons highlighting the failure of Hewlett Packard Enterprise (formerly Digital, Compaq and Hewlett Packard) based in Ayr, to increase the pensions of former employees, with pre-1997 service, in line with the cost of living.

“This affects about 1500 people in Ayr and surrounding areas. I urged the Minister for Pensions to implement the recommendations of the House of Commons Work and Pensions Select Committee, some of which were suggested by the Hewlett Packard Pensioners Association (UK).”

Speaking in Parliament Mr Dorans said: “I speak on behalf of my constituent Patricia Kennedy, as well as 9,625 members of the Hewlett Packard Enterprise UK pension scheme, which includes more than 4,000 members of the Hewlett Packard Pension Association.

Patricia Kennedy, from Coylton, is a former Digital employee and she has taken the fight to Hewlett Packard Enterprise
Patricia Kennedy, from Coylton, is a former Digital employee and she has taken the fight to Hewlett Packard Enterprise -Credit:Submitted/Ayrshire Post /

“These are people with an average of 20 years’ loyal service, the bulk of it pre-1997. They were promised a good pension. They expected a “fair deal” from a world-leading corporation that they helped to build, but now find themselves left with a “raw deal”. In general, their pensions now have less than 70 per cent of the expected buying power.”

He added: “Hewlett Packard Enterprise, while presenting itself to its customers and investors as the most ethical company in the world, is taking advantage of the weakness in the UK pension legislation relating to pre-1997 service. That has resulted in a “raw deal” average pension of £9,700, which, even when topped up with the maximum state pension, results in “low income living” as defined by the Government.

“Regardless of its legality, this practice is heartless, immoral and unethical, and it is absolutely unacceptable from a major global corporation.”

The UK Government published a consultation on options for defined-benefit pension schemes in February and they are currently analysing the responses. But Parliamentary Under-Secretary of State for Work and Pensions, Paul Maynard, said in Parliament that “better outcomes” for savers “lie at the heart of their proposals.”

He added: “We all agree that occupational pensions are crucially important. Many hard-working people across the country depend on their occupational pensions for an income in retirement, having spent years paying into their pension scheme. All of us have constituents who have done the right thing, worked hard and contributed to their occupational pension scheme, so it matters to all of us that they get what they have been promised when it falls due, as set out in the rules of the scheme.”

An HPE spokesperson previously said they were “committed” to satisfying all of its responsibilities in relation to its pension scheme to both current and former employees and they would continue to “act in good faith” and to give the matter “due and appropriate consideration.”

HPE has also been contacted for an updated response.

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