Tata Steel signs agreement for pensions deal

THE final move to secure the pensions of tens of thousands of steelworkers has been announced, ending any fresh doubts about future payments.

Steel giant Tata gave details of a new scheme to replace the British Steel Pension Scheme (BSPS).

Workers voted earlier this year to accept lower benefits in return for investment which will secure jobs.

Finalising the pension arrangements is expected to clear the way for Tata to merge its European steel business with German company Thyssen Krupp.

Tata Steel UK said it had signed the documentation for a so-called regulated apportionment arrangement (RAA) with the trustee of the British Steel Pension Scheme, offering “more sustainable outcomes” for pensioners, employees and the business.

When the RAA takes effect the British Steel Pension Scheme will be separated from Tata Steel UK and a number of affiliated companies.

Tata Steel’s group executive director Koushik Chatterjee said: “Considering the continued challenges in the global steel industry as well as the uncertain global politico-economic environment, the RAA presents the best possible structural outcome for the members of the British Steel Pension Scheme and for the Tata Steel UK business.

“The RAA is one important milestone in Tata Steel UK’s journey towards a sustainable and enduring future, with pension obligations whose risk profile would be consistent with the underlying business.”

The steel trade unions Community, Unite and GMB, said in a statement: “We welcome the RAA announcement which includes a commitment that Tata will stand behind a new scheme with reduced annual increases.

“For over a year our members have feared for their security in retirement, and this announcement helps to bring that uncertainty to an end.”