Tata Steel have today announced the separation of the British Steel Pension Scheme (BSPS) from its business. The new pension scheme will receive £550 million from Tata Steel and a 33% equity stake in TSUK. Members’ accrued benefits will be protected, but future pension increases for current and retired steelworkers will be lower.
Members of the BSPS will have the option of switching to the new scheme (the new BSPS) or moving with the old BSPS into the Pension Protection Fund (PPF).
Responding to Tata’s announcement, Redcar MP Anna Turley said:
“I welcome that a year of uncertainty and insecurity has come to an end for British steel pension holders who have been unable to plan for their futures.
“It will be some relief that pensions will not have to go into the Pension Protection Fund as had been feared, which would have had a huge impact on steel pension holders in Teesside. However, in order to avoid that option, the new scheme is unlikely to be as good for members as the previous one.
“It is unfair that steelworkers on Teesside have now had to pay twice for their industry. Once in the loss of our steelworks in Redcar, and again with their pensions in order to ensure Tata can continue to operate and keep steel jobs in this country.
“Tata and the government must now ensure pension holders are supported with the right advice on whether to enter this new scheme or not. Everyone’s situation will be different and they must be properly advised on the best option for them. Communication to date has been poor and I urge Tata to step up and support people in making these important decisions. People cannot be left to drift in to the worse option and lose more of their financial security.”