More than 100,000 former mineworkers are set to receive an increase in their pensions from today, following a Government move to return £1.5billion to the miners’ pension scheme.
The boost will see ex-miners receiving an average of £29 extra per week in their pension payments. The increase comes after ministers announced the reversal of what they called a “historic injustice” in the pension scheme.
This hike represents a significant 32 per cent rise in annual pensions for nearly 112,000 former mineworkers and their dependents across the UK.
Trustees of the Mineworkers Pension Scheme called it a “historic milestone” for their members. They praised the government’s swift action in fulfilling its manifesto commitment.
The first instalment of the increased pension payments, resulting from the recent investment reserve transfer, will be paid this month.
Energy Secretary Ed Miliband said: “This Government has kept our promise to return money rightfully owned to the ex-miners and their families.
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Former miners will get a boost to their pension pots following a recent Government decision
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“And today thousands of people will receive the money they deserve in their pension as a result.”
He added: “Today marks an end to a decades-long injustice that has denied thousands across the country the decent pension that they so undeniably deserve.”
He expressed hope that members and their families would be able to enjoy “the victory that they have waited far too long for.”
However, controversy remains as 40,000 former miners have been excluded from a separate multi-billion pension fund.
These miners, who were members of the British Coal Staff Superannuation Scheme (BCSSS), will not receive a share of £2.3billion in retirement savings.
The Government will continue to receive 100 per cent of any profit from this pension fund. This has been labelled a “disgraceful betrayal” by critics.
Most affected miners began their careers in the Mineworkers Pension Scheme but were later moved to the BCSSS after being promoted to senior positions.
The exclusion stems from an agreement made during British Coal’s privatisation in 1994.
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Ed Miliband has claimed the pension boost addresses a “historic injustice”
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Under this deal, trustees of both pension schemes agreed that members would receive half of any surplus generated, while the government kept the other half.
The Government also guaranteed all pensions would be paid and increase with inflation, even if the funds ran out.
According to official figures, the government has claimed substantial sums from both schemes over the years.
This includes £4.8billion from the Mineworkers Pension Scheme and £3.2bn from the British Coal Staff Superannuation Scheme.