UK unions plan strike over Tata Steel's move to scrap pension scheme

British trade unions are preparing for the first national dispute in 30 years and will decide on industrial action after members vote on Tata Steel's proposal to close a pension scheme of the steel group.

Tata Steel's decision to close the British Steel Pension Scheme will affect about 17,000 workers, union officials said, adding, the decision was unnecessary and profoundly disappointing.

The unions said that they have been in discussions with the company since early November, but the steel group is hell-bent on closing the pension scheme. They also warned that they were on the brink of a big industrial dispute for the first time in 30 years.

Unions, including Community, GMB and Unite, are preparing plans to seek members' opinion for industrial action through a ballot after they failed to make headway in their discussions with the company.

Roy Rickhuss, chairman of the union coordinating committee, said, ''Tata Steel's decision to close the British Steel Pension Scheme is unnecessary and profoundly disappointing. It is not a position we expected to find ourselves in, given that trade unions have been in discussions with the company since early November.

''Throughout a long process, we have acted in good faith and negotiated constructively in trying to reach an agreement which addresses what we acknowledge to be a significant deficit in the scheme.

''We have made every effort to compromise with the company, even discussing the possibility of meeting the deficit through changes to member benefits, despite the fact the company is legally obliged to pay for the deficit and has always done so in the past.

''Sadly, the company rejected this offer out of hand. It appears they are hell-bent on closing the scheme and are not prepared to compromise.

''We have lost all faith in the company and its leadership, which has brought us to the brink of a major national industrial dispute for the first time in over 30 years.''

''The company and the trade unions have had a number of meetings to discuss the preliminary actuarial valuation of the British Steel Pension Scheme as at 31 March 2014. Those discussions have been held in a constructive and transparent atmosphere, '' Tata Steel said.

Tata Steel spokesman said the company wants to close the pension scheme and replace it with a defined contribution scheme and that it would consult employees on the proposal.

''The unions and company have discussed the performance of the UK business and considered the challenges facing the pension scheme. We have been unable to come to an agreement that would have enabled defined benefit provision to continue and will be consulting employees on a proposal to close the defined benefit scheme to future accrual.

''It is proposed that future pension provision will be on a defined contribution basis. We remain committed to providing employees with competitive future pension provision.''

However, the company said, the trade unions' proposals to change member benefits "would have unfairly disadvantaged younger scheme members, who would have had to bear most of the impact of the changes".
 
Tata Steel said "a more balanced solution was necessary if the defined benefit scheme was to remain open".