AN MP has accused the company at the centre of one of Hampshire's bleakest pensions scandals of "blackmailing" workers.

Julian Lewis told the Commons that APW Electronics had threatened to close its Chandler's Ford factory and make employees redundant unless they signed up to a deal which cost them up to 80 per cent of their pensions.

Last year the Daily Echo revealed that the value of APW pensions had slumped, meaning staff expecting £20,000 a year could receive just £4,000.

Nearly 1,300 staff and retired pensioners were left devastated and facing an uncertain old age after bosses revealed a £55m black hole in the pension fund.

Dr Lewis, Conservative MP for New Forest East, raised the controversial issue at Parliament during yesterday's Business Statement.

He asked Commons Leader Peter Hain for a debate on the remits of the government's Financial Assistance Scheme (FAS), which offers limited protection to employees whose company pension schemes collapse.

But under current rules pension-holders at APW in Electron Way would only benefit if the company, which is based in Wisconsin, USA, became insolvent.

Dr Lewis asked: "May we have a debate on the financial assistance scheme that the government has rightly set up to try to help people who have had their pension schemes destroyed as a result of firms going into liquidation?

"Such a debate would allow us to raise the case of APW Electronics Ltd in Eastleigh. It has not gone into liquidation, but only because it was able to blackmail its workforce into accepting a huge reduction in their pension returns, or else the company would be liquidated."

He said the debate would allow the Tories to float their own scheme to save employees' pensions, using millions of pounds of cash lying dormant in banks and building societies.

Mr Hain advised Dr Lewis to raise the issue during Department of Trade and Industry Questions in the Commons next week.

Bosses at the Chandler's Ford company have denied Dr Lewis's charge.

A company spokesman said: "To suggest what he has suggested in Parliament this week would be a grave injustice. We would totally and utterly refute any such suggestion."

Hundreds of people were left in shock when APW announced two months ago that the value of its company pension had been wiped out by up to 80 per cent.