TENS of thousands of pensioners of brewing giant Scottish & Newcastle have blasted its Dutch owner Heineken for abandoning a decades-long policy of providing inflation-linked pension increases.
The S&N Pensions Group (SNPG) is lobbying the Commons’ business, innovation and skills select committee to investigate allegations that Heineken has failed to fulfil undertakings given on the pension scheme before the takeover of the Edinburgh brewer in 2008.

Tom Ward – former S&N corporate development and strategy director and now the spokesman for the campaign – claimed existing S&N pensioners, former employees with deferred pensions and current members of the renamed Heineken UK had “been given a raw deal and treated unfairly and dishonourably”.

He added: “Before the takeover, we understood that Heineken NV, the parent company, stood firmly behind its public and private commitments on pensions.

“To now make a U-turn on its very public undertaking to follow S&N’s 40 years or so of company practice in applying inflationary increases to pensions is deeply offensive.”

SNPG said that, at a shareholder EGM in March 2008 to approve the joint ?7.8 billion takeover by Heineken and Carlsberg of Denmark, it was explicitly stated “there is a practice of providing discretionary pension increases each year… it is Heineken’s intention to continue this practice”.

SNPG said the commitment was also made to the Court of Session the following month, which passed the scheme of arrangement for the takeover to go ahead. The commitment to inflation-linked pension increases relates to S&N pensions built up in the scheme before April 1997, before which such increases were not mandatory.

SNPG said Heineken paid an inflation-linked pension increase in 2008, there was “understandably” no inflation linked rise in 2009 when inflation was virtually zero, but that the Dutch brewer paid nothing for 2010 when inflation was running at more than 4 per cent.

SNPG maintained that, although the word “discretionary” was used formally in the takeover relating to such payments, S&N’s Dutch owner has acted “in bad faith” given that it was well aware the Scottish management had a “near-perfect record” of making such payments going back to the 1970s.

Ward said: “Heineken knew exactly what S&N’s management meant in our discussions on pensions (before the takeover]. It was very well-established practice, if not legally guaranteed.

“We were not playing with words. We are talking, in many cases, of people who are 70 and 75 years old, perhaps on pensions of ?6,000 and ?7,000 a year, for whom a retail prices index-linked pension means a lot.”