Issue - meetings

In accordance with Council Procedure Rule 10, to consider motions on notice from Members.

1)    Motion submitted by Councillor Steve Fritchley (Mineworkers’ Pensions)

2)    Motion submitted by Councillor Clive Moesby (Universal Credit)

In accordance with Council Procedure Rule 10, Councillors were able to submit Motions on Notice for consideration at meetings of Council.

a) The following motion was submitted for consideration by Councillor Steve Fritchley;

“To support the recommendations of the House of Commons Business, Energy and Industrial Strategy Committee Mineworkers’ Pension Scheme Sixth Report of Session 2019-21 as follows;

Mineworkers’ Pension Scheme

1. The Scheme’s Trustees had little choice but to accept the Government’s proposal to divide future surpluses on a 50:50 basis, as a condition of securing the Government’s guarantee during the negotiations in 1994. (Paragraph 16).

2. The Government failed to conduct due diligence during the 1994 negotiations and undertook no empirical analysis or evaluation to inform or support the 50:50 split it proposed. The Government was negligent not to take actuarial advice. (Paragraph 17).

3. The 50:50 split was, and remains, arbitrary. (Paragraph 18).

4. To date, the Government has received £4.4bn from the Mineworkers’ Pension Scheme. This is already more than the 1994 expectations of what the Government would receive. The Government is also due to receive at least another £1.9bn, on top of 50% off any future surpluses. (Paragraph 22).

5. The Government has not paid any funds into the Scheme since the surplus sharing arrangement was put in place in 1994. (Paragraph 23).

Fairness of the current terms

6. Many former mineworkers have chronic health issues directly related to their former occupation, and the former coalfields are amongst the most deprived areas of the UK. Sadly, their numbers are also decreasing year by year. Over half of Scheme members receive less than the average pension. Given the success of the Scheme, and the vast sums which have been paid to the Government, it is unconscionable that many of the Scheme’s beneficiaries are struggling to make ends meet. (Paragraph 31).

7. We recognise that the Government’s guarantee is important, has contributed to the success of the Scheme, and has benefitted Scheme members. However, we are not convinced by the Government’s argument that its entitlement to 50% of surpluses is proportionate to the relatively low degree of risk it actually faces in practice. The number of Scheme members and the relative size of the fund has fallen significantly since 1994. Yet, the Government’s ‘price’ for the guarantee has not been adjusted to reflect that fact. With no formal period review mechanism built into the agreement, pension members remain tied to an expensive arrangement. (Paragraph 46).

8. Given that the Scheme has continued to produce strong returns despite the 2008 Financial Crisis and the COVID-19 pandemic, there is little reason to believe the Government will be required to pay into the Scheme before it is wound-up. Even if, in extremis, the Government is required to financially contribute at some point in the future, realistically its contribution will not come close to the (at least) £6.3bn it is currently due to receive in total. (Paragraph 47).

9. Whether or not the Government knew in 1994 that it would disproportionately  ...  view the full minutes text for item 41