British Steel Pension Scheme members urged to contribute to public consultation
Letters from the British Steel Pension Scheme are currently arriving at the homes of the 130,000 scheme members across the country, including people in Deeside.
Based on the information currently available following Tata Steel’s announcement regarding UK portfolio restructuring, it looks increasingly likely that the British Steel Pension Scheme would be required to go into the Pension Protection Fund.
Although the Pension Protection Fund provides a valuable safety net for pension schemes generally, entry would significantly reduce future pension increases for all members of the British Steel Pension Scheme and, for 58,000 people under the age of 65, result in cuts in pensions of at least 10%.
Allan Johnston, Chairman of the Board of Trustees of the British Steel Pension Scheme, said:
“I have written to scheme members setting out why the Trustee believes it is better and fairer to use the scheme’s assets to provide modified benefits under the scheme than to hand the assets over to the Pension Protection Fund.
The modified benefits would be more generous for the vast majority of members than Pension Protection Fund compensation.
Although it is correct that the modification being consulted on by Government would see future pension increases being reduced, they would be no lower than those offered by the Pension Protection Fund and in many cases they would be higher.
In addition, members under the age of 65 would not be subject to a reduction of at least 10% which would apply if the scheme entered the Pension Protection Fund.
Not everyone responding to the public consultation will necessarily do so with the best interests of the scheme membership in mind. It is vitally important that scheme members have their voices heard.”
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