UK Coal deal saves jobs but hits miners' pensions
Wednesday 10 July 2013
UK Coal has succumbed to a radical overhaul of its business that will save 2,000 jobs but will cut miners' pensions.
The group, which can trace its roots to the former British Coal, entered administration yesterday in a move that will see its £543m pension liability transferred to the Pension Protection Fund (PPF).
UK Coal has been suffering financial problems for months, and was restructured following a fire at its Daw Mill mine in Warwickshire last year. The group operates two deep mines and six surface mines under the banner of UK Coal Operations.
About 350 jobs will be lost at Daw Mill, with some 120 of these workers transferring to other mines.
Administrators at PricewaterhouseCoopers will transfer the company's mines to a new holding company, UK Coal Mining Holdings Ltd, which will then be owned by an employee trust and make payments to the PPF.
In terms of retirement savings, about 7,000 pension scheme members will be affected, with 1,000 in final salary schemes losing 10 per cent of the value of their pensions.
The PPF is funded by a levy on businesses with final-salary pension schemes. It said it had £20bn of assets and was able to absorb the UK Coal scheme.
Martin Clarke, the director of risk at the Pension Protection Fund, said: "It became clear to everyone involved very quickly that, whatever the future held for UK Coal, its pension scheme would come into the PPF because of the size of its deficit. By taking on the scheme, we will now protect the pensions of its 7,000 members and provide them security in retirement."
- 1 Nigel Farage: Me vs Russell Brand on Question Time – he's got the chest hair but where are his ideas?
- 2 Harry Potter fans can apply to the Hogwarts-inspired College of Wizardry
- 3 Jessica Chambers: 19-year-old woman 'doused with lighter fluid and burned alive' in the US
- 4 Russell Brand calls Nigel Farage 'poundshop Enoch Powell' in BBC Question Time debate
- 5 Orange Wednesdays are no more
Weather bomb in pictures: Storms cuts power for tens of thousands – and snow is on the way
Jessica Chambers: 19-year-old woman 'doused with lighter fluid and burned alive' in the US
Russell Brand calls Nigel Farage 'poundshop Enoch Powell' in BBC Question Time debate
Russell Brand was rendered speechless on Question Time by this man
Fury at Airbus after it hints the super-jumbo may be mothballed
Disgruntled RBS worker writes hilarious open letter to Russell Brand after anti-capitalist publicity stunt leaves him hungry
Shock poll shows voters believe Ukip is to the left of the Tories
Nigel Farage's approval rating hits 'record low' as popularity suffers in wake of Ukip sex scandal
Nigel Farage defends Kerry Smith 'ch***y' comment: 'If you are going for a Chinese, what do you say you’re going for?'
Ukip candidate jokes about 'shooting peasants' in racist and homophobic rant
Pakistan school attack live: Taliban kill at least 132 children in 'horrifying' massacre
iJobs Money & Business
$200 - $350 per annum: Carlton Senior Appointments: Managing Producer Office...
$125 - $225 per annum: Carlton Senior Appointments: San Fran - Investment Advi...
Up to £70,000 per annum + benefits: Sheridan Maine: Are you a qualified accoun...
Up to £65,000 per annum + benefits: Sheridan Maine: Are you a qualified accoun...