Tata steelworkers have reluctantly accepted a ‘gun to the head’ pension deal which will end their final salary pension scheme and see it being replaced by an inferior defined contribution pension scheme.
Union leaders, Tata management, MPs, AMs and the Welsh government all repeated endlessly to the workforce: accept this deal or see the plant close.
Union leaders have attempted to justify their recommendation to accept the deal by portraying the changes as going from ‘a gold-plated pension to a silver-plated pension’.
Unfortunately, this huge concession by the workforce still provides no guarantees for the jobs of Tata workers across the UK and particularly for the 4,000 workers in Port Talbot who now have to rely on Tata’s so-called commitments to invest in the plant.
At a National Shop Stewards Network (NSSN) meeting in Port Talbot in January, one ex-steelworker said that the £1 billion planned investment over the next ten years was dependant on Tata turning over £200 million profit a year, which is widely regarded as impossible with the rundown state of the plant.
A pledge to ‘seek to avoid compulsory redundancies over the next five years’ was also met with widespread cynicism.
And the deal doesn’t prevent the danger of the 130,000 British Steel pension scheme members potentially entering the pension protection fund as part of the arrangement, resulting in at least a 10% cut to members’ benefits. This threat was played up by all those promoting the deal, including the pension trustees, if the offer wasn’t accepted.
One of the main motivations for ending the final salary pension scheme is to make a sale more attractive to possible buyers such as Krupp Thyssen, who will now not be responsible for the liability of the pension scheme.
What is to stop Tata selling the business and then putting the pension scheme into the pension protection fund? Scandalously this may be legal even though Tata would still be a profitable car business, although conveniently in a different division. This should be a warning to its Jaguar/Land Rover workers and pensioners – better to fight now together with the steelworkers.
One Port Talbot shop steward commenting on the 74% result in favour of the deal, said:
“All of the people I work with claim to have voted No to the proposals put to us in the ballot. Some feel that there’s some kind of conspiracy going on, others just feel that so much pressure was put on the workforce by the management and unions that it pushed through the Yes vote.
“It was only 3-4 weeks ago that we were told by the unions that they felt that due to the feedback they had been getting from union members, it was going to be a definite No vote. It was after this that 100 or so ‘reps’ met and decided that they needed to unanimously recommend a Yes vote.
Since then we have been warned that a No vote would result in the insolvency of Tata and the loss of our jobs. Most people I work with feel utterly betrayed by the unions”.
Many workers will be hoping for the best but also need to prepare for the worst. This battle is unfortunately just beginning. Confidence in Tata is at rock bottom and understandably so.
The only real alternative to protect the long term future of the plant was the demand taken up by the Socialist Party, the NSSN, and some in the workforce, for the nationalisation of Tata steel under democratic workers’ control and management. That would ensure investment, job security and a plan of production that can never be attained through multinational companies such as Tata, whose only concern is profitability at the expense of the workforce. That’s what this grubby ‘realistic’ deal represents.