Mineworkers’ Pension Scheme

Ben Bradley Excerpts

Tuesday 5th December 2017 Westminster Hall

[Nick Smith]

My hon. Friend and neighbour, like my hon. Friend the Member for Islwyn (Chris Evans), gets right to the bone. Nearly £2.7 billion has come from the scheme to the Government as their share of the subsequent surpluses. That means that the Government have taken the same share as the people who earned the pensions in the first place.

Instead of paying in, the Government act as a guarantor in case things go wrong. That is a good thing and has been helpful—the trustees say that. The Government say that they take the money because they will step in and protect the value of pensions if the fund encounters difficulties. The trustees accept that this protection has enabled them to pursue more lucrative investments than might otherwise have been the case. I would like to be clear: we are glad that the Government guarantee is there. It has made a difference and helped to lead to better returns.

[Ben Bradley (Mansfield) (Con)]

I have also met the trustees. Does the hon. Gentleman accept what they have said—that the guarantee is the most important part of the agreement, and that they would not wish to give any movement on that guarantee within the scheme for any price?

[Nick Smith]

The hon. Gentleman is right. When we met the trustees, they told us that the guarantee was important, and I accept that. It has been helpful in terms of pursuing lucrative investments, which have aided scheme improvements and its funding. It has also given miners the peace of mind that the pension they earned will not go down in value, no matter what happens in the markets. It is a good thing. The basic nature of the guarantee is not in dispute. The concern is about how much money is being taken out of the surplus in return for it. That is the question we have to try to tease out.

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[Ben Bradley (Mansfield) (Con)]

It is a pleasure to serve under your chairmanship, Mr Paisley. I thank the hon. Member for Blaenau Gwent (Nick Smith) for securing this important debate. I ask hon. Members to bear with me, because while I will probably reach the same conclusion as others, my rhetoric might be slightly different.

Like many hon. Members, a number of my constituents who are beneficiaries of the mineworkers’ pension scheme have contacted me with concerns about its arrangement. I, too, recently met the scheme’s trustees, and had a long and productive discussion with them. The closure of the mines was obviously a major blow to people in my constituency. The mines represented their livelihoods and communities, so I understand why this is such an emotive issue.

I am not here to retread history. Successive Governments have undoubtedly ignored this issue, but the existing scheme also has a number of benefits. The guarantee that the Government provided for this scheme, and careful investment, has meant that the pensions of ex-mineworkers are a third higher than they would have been had the guarantee not been made. We should be clear that, at that time, the profit-sharing arrangement corresponded with the risk assumed by the Government in underwriting the fund. However, times have moved on, and thanks to the scheme’s excellent financial management, investments have thrived and the Government and pension holders have done well. With that in mind, I would like more of the profits from the scheme to go to the people whose hard work and dedication paid into it, and I ask the Government to consider changing the profit-sharing model in line with the fund’s success.

Mansfield has long felt ignored and alienated from Westminster, and it has never believed that this place has its best interests at heart. As the constituency’s new Conservative MP, I want that attitude to change, and I urge the Government to revise their share of profits from the scheme down to a fairer but sustainable level, without compromising that guarantee. It is now time to have that discussion directly with trustees, and to show that a Conservative Government have a commitment to supporting coalfield communities in the future.