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Nationalise Tata Steel to save jobs and pensions
The announcement that Tata Steel and the leaders of the steel unions have potentially reached an agreement to stop the closure of the Port Talbot works and the other Welsh and UK plants has understandably been greeted with enormous relief by the local community. It has been politically impossible for governments in Westminster and Cardiff to stand idly by and let these works close, particularly emphasising the weakness of the crisis-ridden Tories.
However, Tata's decision to reverse its planned closure by committing to keep the two blast furnaces operating for five years, 'seeking' to avoid compulsory redundancies for the same period and also investing £1 billion over the next 10 years, comes with a poisonous sting in the tail. The company also wants to make a further £10 million saving as part of this deal. This will come from downgrading terms and conditions which hasn't been discussed yet.
Tata wants to close down the final salary British Steel Pension Scheme (BSPS) and replace it with an inferior Defined Contribution Scheme. 130,000 present and past employees are members of the BSPS and could face a huge cut to their pension entitlement. Understandably, workers are torn but angry. Reflecting this, the unions will now put the 'rescue package' of proposals to the workforce, without a recommendation.
One steelworker told the Socialist:
"I'm not sure of the potential losses that will be felt due to the scheme closing but part of last year's pension settlement was that it was 'agreed' that the ability of workers to take early retirement at 60 and not suffer any financial penalties was given up. It was replaced with: workers who wished to and were financially able, could retire at 60 but lose 25% of their pension - despite the unions all saying no steel worker should ever have to do that.
"When the scheme closes we will all become deferred pensioners of the BSPS and will have to wait until 65 to claim our pension. There will not be the option of taking it early with the financial hit. Some have already taken their 'pot' out of the BSPS and I think more will follow before the scheme is closed, as my understanding is once the scheme is closed your 'pot' is locked in till 65.
"The mood in the plant I work in is very negative, disheartened etc. Most people have only just come round to accepting working five years longer in this tough industry or losing 25% of their hard-earned money and despite agreeing to this the company once again wants the scheme closed.
"Most people I have spoken to feel that with the BSPS closed Tata will probably sell us off pretty quickly. We are all too well aware that a guarantee from the company is no guarantee at all! The media has been really positive about this offer and there are worries that steel workers will look very ungrateful if they don't accept the offer that is on the table."
18 months ago, steelworkers voted for strike action when Tata threatened the closure of the BSPS. Now Tata has come back again, only this time the implied threat is accept pension cuts or face potential closure of the plant!
In April, at a protest march and rally in Port Talbot organised by the National Shop Stewards Network, the main demand put forward by the protesters was to 'Nationalise Tata to Save Steel'. This demand gained a big echo amongst steelworkers and their community who had no confidence in the Tata board to save their jobs.
It could and should have been the platform for a serious struggle led by the steel unions to win this outcome. Partial nationalisation was even accepted by the Tory government as well as Labour MPs and Welsh Assembly Members who recognised the political and social explosion that would occur if the plant was left to go under. But while the leaders of the steel unions passively went along with this idea, they refused to really campaign by mobilising their members and the community to force the government to take the plants over.
Instead in reality, they have been reduced to trying to come to an agreement acceptable to Tata or failing that, to find a private buyer.
If Tata can renege on its long standing pension scheme agreement then what are the chances of Tata standing by its 'commitment' to keep the furnaces firing, promising no compulsory redundancies or continuing the investment plans?
In an economically and socially depressed town like Port Talbot, the wage rates of full time employees in Tata, which are at least double the minimum wage, are an extremely rare exception. No doubt the Tata executives have taken this into account when deciding to close the BSPS. Many workers will be torn at the prospect of seeing their pension agreement ripped up or alternatively possibly losing their jobs.
Many steelworkers have no confidence or trust in Tata to honour its long term commitments in Port Talbot and elsewhere.
Instead of standing to one side and cowardly offering no recommendation to their members, the leaders of the steel unions should be demanding the nationalisation of steel under democratic workers' control and management as the only real chance of securing the hard won British steel pension scheme and guaranteeing the long term future of the UK steel industry.
This version of this article was first posted on the Socialist Party website on 9 December 2016 and may vary slightly from the version subsequently printed in The Socialist.