Frank Field MP seeks pledge on pensions from steel giants Tata and ThyssenKrupp
A senior MP has demanded assurances over the fate of 130,000 British steelworkers’ pensions when a giant new European steel venture is created.
The Indian industrial behemoth Tata recently won permission to offload the British Steel Pension Scheme and create a new fund with poorer benefits.
The deal paves the way for Tata to merge its European steel operations, including the Port Talbot plant in south Wales, with those of Germany’s ThyssenKrupp.
The British Steel scheme will fall into the Pension Protection Fund (PPF), the government-backed lifeboat. Under the deal, backed by the Pensions Regulator, current and retired workers will have a choice of transferring to the new scheme or to the PPF. In most cases, they will lose less of their benefits by opting for the new scheme.
However, Frank Field, who chairs the Commons work and pensions committee, said it was uncertain whether the joint venture — which will be Europe’s second-biggest steel maker — will honour the terms of the scheme.
“It is now all too clear that the livelihoods of 130,000 British Steel pensioners lie in the hands of the new owners — a pan-European super-giant — and not the Pensions Regulator. Even if the vast majority of members opt for the new scheme, the owners could still pull the plug and send them into the PPF,” said the veteran Labour MP.
Field also raised concerns over the qualifying criteria for the new scheme, which he believes are unclear. “I will be writing to ThyssenKrupp and Tata to ask what assurances they can give to British Steel pensioners.
“What will the mysterious qualifying criteria be? What commitments will they make to ensure the scheme starts and stays in a healthy state?”
He added: “In the event the new scheme does go ahead, the owners will decide whether to start paying cost-of-living increases for pensions accrued before 1997, the oldest members.”
? The head of the PPF, Alan Rubenstein, has said he is “comfortable” about coming behind the investment firm Greybull Capital in the list of Monarch Airlines’ creditors. The PPF took on the carrier’s pension scheme three years ago, when Greybull bought Monarch. The PPF has lost its 10% stake in the airline, which collapsed this month, and ranks behind Greybull in recouping £7.5m of debt.John Collingridge, The Sunday Times