A pension provider has been underpaying members for a decade by breaching the terms of its policy, WalesOnline can reveal. Financial services company Wesleyan administers pensions for many former employees of Allied Steel and Wire (ASW), a major Cardiff-based firm which went bust in 2002. But a former senior manager at ASW has discovered a discrepancy in payments — and he believes the total shortfall could be hundreds of thousands of pounds if not higher.
The breach began in 2013 when Wesleyan changed the pension scheme's inflation measure from the Retail Price Index (RPI) to the typically lower Consumer Prices Index (CPI). Wesleyan has apologised for the "error" and vowed to repay the money owed plus an 8% annual interest payment backdated to the start of the breach.
The former ASW senior manager who exposed the underpayment told WalesOnline he stands to benefit in the region of £500 but he believes more than 1,000 former colleagues are on the same scheme. "You could be talking hundreds of thousands of pounds or more," said the former manager, who spent around a decade at the steelmaker and retired a few years before its collapse. "There are people who have died in the mean-time, whose families are entitled to benefit... If they've done this to other schemes they administer, it could be a huge figure."
