Thousands of former coal industry workers across the UK have started receiving a significant boost to their weekly pension income, alongside a substantial one-off back payment.
Historic Payout Begins
From today, eligible members of the British Coal Staff Superannuation Scheme (BCSSS) are seeing their weekly pension payments increase by an average of £100. This forms part of a major government decision to release a £2.3 billion investment reserve that had been held since the industry's privatisation.
In addition to the ongoing weekly increase, pensioners are receiving a backdated lump sum payment averaging around £5,500. This sum covers the period from November 2024, when a similar rise for the separate Mineworkers' Pension Scheme took effect.
Ending a "Decades-Long Injustice"
The move follows Chancellor Rachel Reeves's announcement in the Budget and marks the conclusion of a long campaign. The BCSSS covers not only former miners but also staff who held non-mining roles at collieries, such as engineers, managers, canteen workers, and administrators.
Energy and Net Zero Secretary Ed Miliband stated: "I want to pay tribute to all the mineworkers and all the campaigners involved in ending this decades-long injustice." He added that the 41% uplift in pension payments would provide thousands with "the retirement they deserve" just before Christmas.
Cheryl Agius, chair of the BCSSS trustees, called it a "historic moment" achieved through a year of "determination, advocacy and collaboration." She confirmed the move brings BCSSS members into line with their former colleagues in the Mineworkers' Pension Scheme, who received their share of the investment reserve in November 2024.
The Surplus Debate
The decision to transfer the reserve fund to members has not been without controversy. The reserve was established as part of the 1994 privatisation deal of British Coal, where the government guaranteed all pension payments, including inflationary increases. In return, the government was entitled to 50% of any investment surpluses, with the other half going to members.
Campaigners have long argued that the reserves were built up by the scheme members themselves and should be returned to them. Critics, however, contend that the money belongs to taxpayers, as the government's guarantee protected pensions if the fund ran dry.
Successive governments have already withdrawn approximately £3.2 billion from the scheme under the surplus-sharing arrangement, which was paused in 2015 after the fund entered deficits. The remaining government share sat in the investment reserve, acting as a buffer. It was due to be fully accessible to the government from 2033.
Opponents of the payout argue it strips away billions owed to taxpayers in the future and could leave the public liable if the scheme falls into deficit again. The government has stated it will meet with BCSSS trustees in the new year to agree on future surplus-sharing arrangements.
The British Coal Staff Superannuation Scheme remains one of the UK's largest occupational pension schemes, providing benefits for 40,000 pensioners and deferred members.
