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Tata jobs – at a price

Vote on pensions begins
Hajera Blagg, Monday, January 30th, 2017

Tata steelworkers are set to vote in a ballot that opened today (January 30) over the company’s proposals to rescue the Port Talbot steelworks, commit to investment and save thousands of jobs across its UK sites.


Tata Steel has committed to £1bn in investment to modernise its operations over the next 10 years, and has pledged to keep its two-blast furnace operation at Port Talbot steelworks for the next five years. Under the plan, no compulsory redundancies will be made also for the next five years, in effect preserving 8,000 jobs.


The steel company, which earlier this year put up its UK operations for sale, is now instead eyeing a merger with German industrial giant Thyssenkrupp if the proposals are accepted.


The rescue plan hinges on members accepting changes to their pensions, which will entail closing the final salary pension scheme to future accrual and replacing it with a defined contribution scheme with employer contributions of up to 10 per cent – above the UK defined contribution scheme average of 4.5 per cent.


The steel unions were instrumental in reshaping the proposal to gain an additional pledge from Tata, which could see members older than 50 who are planning on retiring early receive a one-off payment of up to £10,000, depending when they plan to retire and how long they’ve been contributing to their pension scheme.


The steel unions, including Unite, are now recommending that their members vote in favour of the proposals after meeting with over 100 steel reps on Thursday, January 26 and getting feedback from them.


“We do not make this recommendation lightly,” the steel unions said in a joint statement to members last week. “Nobody is saying that the proposal on the table is without issues. We fully understand the concerns of members, particularly around the BSPS [British Steel Pension Scheme].


“But as we have said before what you are voting on is the best outcome that could be achieved through negotiation,” the statement noted. “It is our collective view, supported by our independent experts, that this is the only credible and viable way to secure the future.”


‘Never would have wished for this’

While the steel unions acknowledged that steel workers are in a “situation that we would never have wished for”, they highlighted too that “it is also the only way to protect the benefits you have already accrued and to provide a chance to prevent the BSPS free-falling into the Pension Protection Fund.”


“We should also make it clear that a ‘no’ vote will not stop the BSPS from closing to future accrual,” the unions pointed out. “That is our view based on what every pension expert, lawyer, consultant and BSPS Trustee has told us.”


Unite national officer for steel Tony Brady told UNITElive that he completely understood that the workforce may be feeling demoralised and distrustful of Tata Steel. But he urged them to carefully consider the proposals.


“In our view, it is the best pathway to keeping the industry alive,” he said. “We are in a far better position than we were in last year and Tata’s commitment to a decade of substantial investment gives us hope that steel will have a long and viable future in the UK.”


The steel trade unions have also secured a provisional binding agreement from Tata underpinning their commitments, but this is dependent on the workforce accepting the proposals.


Brady added that Unite will stand by its members all the way and highlighted what else the union was doing to support the workforce.


“Unite has been instrumental in, for example, successfully lobbying the Welsh government for further investment and support,” he explained.


Last month, the Welsh government committed £8m in support, to be spent on reducing energy costs and cutting carbon emissions at the Port Talbot steelworks, which would help future-proof the steel industry in Wales. The Welsh government also committed to an additional £4m which would go towards skills and training.


“We urge the Westminster government to mirror the Welsh Assembly by committing to investment in the steel industry,” Brady added.


‘Very frustrated’

Unite Port Talbot steel rep Mark “Pasty” Turner explained that the Tata workforce in Port Talbot was very frustrated at the decision they now have to make.


“To be honest, there’s lots of anger over changes to the pension scheme, and rightly so,” he said. “But I think there’s a certain level of resignation among many in the workforce that this is the only deal that will ensure a future for the steel industry in Port Talbot.”


“There’s significant distrust in Tata Steel at the moment,” Turner added.


He explained that steel unions were negotiating for the very best possible deal up until the eleventh hour, and he was confident that this was the best deal they were able to secure.


“At this point, the alternative doesn’t bear thinking about,” he said.


Turner noted it is vital that each and every Tata steelworker uses their vote.


“It would be very disappointing if there’s a low turnout on a vote that in many ways determines the UK steel industry’s future,” he said. “While we urge members to accept the proposals, whichever way you feel about it, it’s important above all to cast your ballot.”


The ballot is set to close on Wednesday, February 15 at noon. Find out more about Tata Steel’s proposals here.



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