In his latest blog for Caerphilly Observer, Plaid Cymru South Wales East AM, Steffan Lewis, speaks about his fight for a fair solution to the mineworkers’ pension scheme.
Summer contact
During August, the National Assembly for Wales takes a summer break. Without having to travel down to Cardiff Bay each week, Assembly Members are free to catch up with casework in our communities and can focus on local issues.
I am holding twice weekly street surgeries throughout the South East region during the summer. If you’d like to find out when I’m in your area, or to speak to me about a problem I might be able to help you with, please get in touch with my office.
Mineworkers’ pensions
One issue I am currently looking in to is the fight to have the UK Government review the Mineworkers pension scheme. A deal made in the 1990s saw the Conservative Government agree to underwrite mineworkers’ pensions, but in exchange they can skim off 50% of the surplus each year.
Over the decades, the UK Government has benefitted from £8 billion from this surplus at a rate of £1 million a day.
Meanwhile, ex-mining communities remain some of the most deprived in the UK and miners themselves struggle with the ongoing health impact of their work. Many feel that they have been cheated by successive UK Governments who have pocketed so much money from their pension scheme, money that they and their communities could have been helped by.
This is, of course, something which is hugely important in the South East, with our proud mining history. I am fully supportive of miners’ campaign to have the pension scheme reviewed and a more fair settlement found so that miners can receive a greater share of the surplus it generates.
This was the very first issue I raised on the floor of the Assembly after my election in May. I am seeking a meeting with Richard Harrington MP, the Parliamentary Under Secretary of State for Pensions, the UK Government Minister responsible, to discuss how we can find a fair solution.
There is currently a petition being run to support the miners’ campaign. I would urge readers to sign.
It can be found here.
As a member of this scheme awaiting a deferred pension when I reach sixty years of a age I urge caution when outsiders are tempted to meddle with the agreement. The plan was drawn up between the government and trustees twenty years ago and sought to ensure that whatever happened to the investments members of the scheme would still get the pension they were entitled to.
It works like this – any surplus from the investments is split, half goes to increase the pension and half to the government. In return the government is locked into a cast iron guarantee that it will pay a pension based on the level earned before 1994 indexed in line with RPI, even if the scheme has insufficient funds to pay the pensions.
Over the years the scheme has done well because the guarantee meant that the trustees could allow ‘agressive investment’ – taking chances to you and I – in the knowledge that the fund was government protected. This has brought huge benefits, for instance my pension years are now considered as sixtieths rather than eightieths, of final salary as was thcase when I left the industry in 1990. In cash terms I am now entitles me to more than double the pension figure I was quoted in those days.
Government has benefitted, that is true, but half of every year’s surplus has gone to fund better pensions and I have peace of mind knowing that my future pension is protected. Of far more concern to me is that I was told when I was sixteen that my state pension would pay out as soon as I was sixty five. It does not pay out until I am sixty seven currently and there is no guaranteee that this age threshold will not increase further as I am eleven years away from the new pension age. This means I am being robbed blind – along with everyone else my age – and am set to lose £16,187 on current rates of pension.
I would much rather Steffan address this issue rather than an agreement that has actually benefitted members of the Mineworkers Pension Scheme.