Ballast Nedam denies £75m UK pension liability
UK/NETHERLANDS - Dutch construction company, Ballast Nedam has claimed it never had occupational pension liabilities in the UK, where around 1,000 former employees are likely to experience severe cuts to expected pension.
UK subsidiary, Ballast plc went into administration in October 2003 after Ballast Nedam decided to stop financing what had become a loss-making enterprise.
Members of three occupational schemes associated with Ballast plc are now set to receive as little as 17% of their expected retirement benefit, and are hoping on the Financial Assistance Scheme and political campaigns to improve their plight.
UK pension watchdog, The Pensions Regulator, declined to confirm reports in Dutch newspaper, Het Financieel Dagblad that it will hold an inquiry into the affair.
But Theo Brujninckx, chief financial officer at Ballast Nedam in Nieuwegein, today told IPE there never were any pension liabilities in the UK and hence the firm will not make any payments into the funds.
"We [Ballast Nedam NV] never had any obligations: Ballast plc was the direct sponsor of the pension funds, this firm always operated independently," he said.
In 2003 the Dutch parent decided to stop financing its loss-making British subsidiary Ballast plc, a construction company which the Dutch firm in bought 1990 after it had gone into administration.
The three pension funds under Ballast plc, which wasn't able to survive without financial support and subsequently came under administration in October 2003 and was liquidated July last year, had a deficit of £50m (€78m) before their wind-up in 2003, according to reports.
That figure is now estimated to have risen to £75m.
During the parliamentary discussion of the UK's Pensions Act 2004, which obliges sponsors to meet their pension obligations retrospectively as far as April 27, 2004, shipping company Maersk Sealand and Ballast Nedam were cited by members of parliament as foreign companies attempting to get out of their pension responsibilities.