A GOVERNMENT scheme to help former members of the Allied Steel & Wire (ASW) pension scheme will still leave many workers with little or no money, say campaigners.

The Pensions Action Group, whose members include former ASW steel mill employees at Sheerness where pensions disappeared when the company was wound up, have welcomed the £400 million Financial Assistance Scheme (FAS) announced by the Department of Work and Pensions.

But former ASW employee John Hayter, who still works at the steel mill, said: "This is totally inadequate. As far as I am concerned, the Government is spinning this FAS for all it’s worth.

"We have been robbed. This Government has let decent, hard working people down badly."

Under the FAS, people from wound up schemes within three years of their pension retirement age will receive 80 per cent of their pension entitlement - up to a maxiumum of £12,000 per year.

Campaigners say that if someone had been earning £20,000 per year, they could be left only a £12,000 annual payment.

The statement from the campaign group said: "It is thought that some 15,000 people will benefit, but this still leaves well over 50,000 people with no idea of what pension, if any, they will receive.

"The scheme does not include anyone who lost their pension when their solvent employees wound up the scheme. The employers acted totally legally and the pension scheme members cannot force their employers to put in more money."

"No protection against inflation will be provided. People will retire with a smaller pension then they were promised and will get progressively poorer with age. Three per cent inflation will halve a fixed pension in just over 20 years."

The Pensions Action Group, which will continue to campaign for until its members’ full pensions are restored, said that the unions Amicus and Community were pursuing their legal action against the Government over the loss of pensions through the European Court, but this was likely to take several years. An investigation by the Parliamentary Ombudsman into the issue is continuing.

Sittingbourne and Sheppey MP Derek Wyatt said he would continue to campaign for the compensation scheme to be improved.