LONG-suffering workers at Hampshire's APW Electronics had their worst fears confirmed yesterday when they were told the firm had gone into administration.

Major question marks now hang over the future of the 200 staff employed at the Chandler's Ford base of the company behind the worst pension scandal in the south.

At 1.30pm yesterday, they were told cash flow problems meant the American-owned business could not continue and the running of the company had been handed over to administrators Kroll.

Earlier, staff at the Electron Way site had demanded talks with management after rumours that the firm could shut sparked fears they might not get paid. They threatened to down tools if they weren't given assurances about their future.

Administrators said they plan to keep the business open while they decide whether to sell it or break it up.

APW's business hit the buffers in September last year when a major order was cancelled and it couldn't recover from the loss.

A statement from Kroll said: "The company entered into administration due to cash flow difficulties following the loss of some significant orders. The company will continue to trade while the joint administrators review options for the business."

Administrator Andrew Pepper said: "We appreciate that this is a concerning time for the 200 employees of APW, however, we will continue to trade the company while we review and evaluate options, and we will keep employees advised of developments."

The firm first hit the headlines in 2004 when it axed its pension scheme. Questions were asked in the House of Commons as more than 1,200 people lost up to 80 per cent of their pension savings.

APW bosses said a £55m black hole in their pension scheme meant they were unable to keep both it and the business afloat.

Following concerted pressure from local MPs and a Daily Echo campaign, the Government eventually opened its pension lifeboat scheme to roughly half the affected pensioners allowing them to claw some money back.

Staff were yesterday told not to speak to the media in the interests of their long-term job security because bad publicity might affect future orders.

But one worker who asked not to be named for fear of losing his job said: "It's rubbish, isn't it? First of all they tell us that they're going to cut our pensions just so we can keep our jobs now they turn around and tell us we possibly can't have the jobs anymore anyway.

"There's an awful lot of confusion and the people I work with really don't know if they're still going to have a job at the start of next month.

"I've been here for almost 20 years and figured I'd see my career out here but now I just don't think that's going to happen."

Unions said it was yet more for staff to endure.

Ian Woodland of the TGWU said: "They have been hit below the belt yet again. Staff at APW in Chandler's Ford have been knocked quite a few times over the past few years and to a lot of them here this latest news was not entirely unexpected.

There's a lack of confidence that the management team will be able to dig themselves out of this, but staff do remain supportive about keeping their long-term employment at the site.

"The new administrators have promised to keep staff informed about how things are going and about their long-term futures. The company say they lost a big order in September and that led to this situation. Apparently orders are still coming in but not enough to keep it out of administration.

"Money has been lost and the cost of keeping the factory open is currently more than the amount of cash coming in."

Terry Edwards of the Amicus union said: "Staff morale is pretty low. Firstly there's lots of rumours going around and speculation about what will happen to the company.

"From conversations we've had with the administrators they say they hope it will continue to produce goods and stay viable but it's not up to them."