Socialist Worker

Reject steel pensions blackmail

Issue No. 2506

Marching in Scunthorpe against Tata layoffs last year

Marching in Scunthorpe against Tata layoffs last year (Pic: Neil Terry)

The government wants to cut Tata steel workers’ pensions to make the firm’s remaining assets in Britain easier to sell. This would rob workers of pensions they’ve already paid for—and set a dangerous precedent.

The British Steel Pension Scheme (BSPS) has a £700 million deficit. Firms say they might snap up Tata’s steel works on the cheap, but not at a cost of bailing out the pension fund.

The Tories first looked at taking BSPS into the state-backed PPF pension scheme. But this would come with a cut of more than ten percent for many workers.

Now business secretary Sajid Javid proposes a law change so BSPS pensions can rise in line with the CPI inflation rate not the RPI rate. CPI is typically around 1 percentage point lower.

Workers would lose about £2.5 billion.

The fear of job losses must not be used as cover for, as steel unions put it in a joint statement, “employers dodging their pensions responsibilities”.

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