Ex-Nissan staff call for rethink on pension scheme
Steve ClareNissan is being urged by former employees to increase part of its pensions in line with inflation.
Steve Clare, from Chester-le-Street, worked at the Sunderland factory for 31 years and paid in to a direct benefit pension, but the pot of money accrued before April 1997 did not get inflation-linked rises because there was no legal obligation.
"It looks like when it's time to take your pension, someone's cut a hole in the bottom of the bag and you're getting less and less," he said.
Nissan said it administered its pensions in full compliance with regulations. Labour MP Luke Akehurst said the issue affected other members of similar schemes and planned to ask the government to change the law.
A direct benefit pension is a fixed sum of money that is paid out each year by a former employer.
There is a legal obligation to pay a capped inflation-linked increase for pensions built up from 6 April 1997, but not for money put into such schemes before this date.
Clare, who started at Nissan in 1985, said: "Ultimately this meant a real-world loss to people's pension pots.
"I retired in January 2016 and inflation since then has been just over 40%.
"The state pension's increased by 48% in that period. My Nissan pension's increased by 8.3%," he said.
Di GommDi Gomm said she was the 56th employee to join the Nissan factory in Sunderland in 1985.
"We joined a company which was embryonic and we expected to be treated fairly," she said.
"I do feel that particularly the employees that joined in the beginning who worked so hard for the company have been let down."
David Harris said he could not enjoy retirement "as you want to" due to lack of top-up payments to the pre-1997 part of his pension.
"You imagine long holidays and really taking things easy but you can't really afford to do that," he said.
David HarrisLabour MP Luke Akehurst called the issue an "injustice" which not only affected Nissan employees, but other members of direct benefit schemes across the country.
"Each year they find that because the cost of living is going up, they haven't got the income that they need in retirement," he said.
"There's a particular unfairness that as people get deeper into their time of retirement, their disposable income is less and less keeping pace with inflation."
A Nissan spokesperson said: "By nature, discretionary increases are not guaranteed and any decision that the trustees make on it must take into account all relevant factors."
Akehurst said he planned to put pressure on the government to change the pre-1997 law.
The Department for Work and Pensions (DWP) said it was working on pension reforms which included giving trustees of well-funded defined benefit schemes more flexibility to negotiate improvements for members.
