The UK government has announced a £1.5 billion payout for 112,000 former coalminers, changing a long-standing injustice and significantly boosting their pensions by an average of 32%
This decision follows years of campaigning by ex-miners and their families who fought for fair treatment and compensation for their hard work in powering the nation’s industry.
Mineworkers’ Pension Scheme’s investment reserve fund
The £1.5 billion will be transferred from the Mineworkers’ Pension Scheme’s investment reserve fund, a pot of money that was built up from the scheme’s profits but had remained unused.
Initially created in 1992, the reserve fund was intended to cover any potential deficits in the pension scheme. However, due to strong returns on investments, the government continued to hold onto the fund, even though it was meant to benefit the miners.
The decision to hand over the money is expected to increase the annual pensions of 112,000 former mineworkers by an average of £29 per week, bringing much-needed financial relief to those who have long faced pension shortfalls.
This increase means a 32% boost, offering a significant improvement to the lives of former miners and their families, many of whom worked in the coal mines for decades.
Why has the government made this decision now?
The payout comes after years of campaigning by former miners, who argued that the government had unfairly profited from the pension scheme without contributing any funds itself.
When the UK coal industry was privatised in 1994, the government agreed to take half of the profits generated by the pension fund, with the promise that miners’ pensions would increase in line with inflation. However, the government’s share of the profits has not been returned to the scheme, until now.
The £1.5 billion will be distributed by the trustees of the Mineworkers’ Pension Scheme, who are working to ensure that payments are made as soon as possible. The trustees are also committed to reviewing the scheme’s long-term future to ensure former miners continue to receive fair payouts in the years ahead.
This payout shows a major step in righting the historic wrongs faced by Britain’s mining communities, who for years fought for their contributions to the country’s prosperity to be properly recognised. The move is also part of broader government efforts to support the UK’s clean energy transition, including investments in renewable energy projects such as onshore wind and offshore wind farms.
