In response to recent media stories about a potential buyout of the British Steel Pension Scheme, the BSPS trustees have published a statement.
Community welcomes the statement as it is important the trustees consider options to secure member benefits in full. However whilst securing existing commitments must be a priority, it is also vital that Tata and the trustees remember the sacrifices made by steelworkers and their families during Time to Choose. We’ve always said that when scheme funding allows, Tata and the trustees have an obligation to restore benefits, in particular for those members with pre-1997 service.
Community is also clear that, in the event benefits are to be secured through an insurance company, every penny of any surplus must be ring-fenced for restoration of benefits. We welcome the trustees’ comment that, “in this scenario they do not expect there would be any surplus paid to Tata Steel”, however ultimately this decision rests with the company not the trustees. Tata Steel are very aware that any move to appropriate scheme members’ money would be completely unacceptable to the trade unions.
In May Community welcomed confirmation of the debt for equity swap, which will help deliver a sustainable future for Tata Steel UK and strengthen the financial position of the scheme sponsor. It is disappointing, however, that the debt restructure means the loss of one of the three methods to restore benefits that were agreed as part of the RAA. We expect Tata and the trustees to deliver on the letter and the spirit of the remaining restoration provisions.
You can view the BSPS statement by clicking here.