Questions from Scheme members

29 June 2021

Following the publication of the Business, Energy & Industrial Strategy Committee’s report on 29 April 2021, we have received a number of questions from members about how benefits might change in future. We have provided a short Q&A below with some of the most common questions. The Trustees welcome the report and support the recommendations within it. We would be delighted to implement changes to the Scheme which improve the position of our members.

What are the main recommendations made by the Committee following its Inquiry?
The Committee recommended that the Investment Reserve should be used to provide an immediate cash uplift to pensions and that all future surpluses should be distributed to members by default, with the Government only receiving surplus monies in future if the Scheme has previously fallen into deficit and the Government has had to provide funds.

Is the Government bound to implement the recommendations from the Committees Report?
No, the Government is not bound to implement any of the recommendations outlined in the Report.

Is it illegal for the Government to take money out of the Scheme?
No. The Scheme Rules set out the circumstances under which payments are made to the Government from its share of past surpluses. These payments are permitted by law.

Who will get all of the money from the Scheme when the last member dies? Will it go to the Government?
The Trustees manage the Scheme with the aim that at any point in time there is always enough money to pay all future pensions. At each triennial valuation the Actuary makes assumptions about future investment returns and expected future pensions payments, to assess whether there is a surplus or deficit. If there is a surplus, part of that surplus is used to enhance members' pensions through the surplus sharing arrangement and the remainder is paid to the Government. In this way the Trustees expect that all of the Scheme's assets will be paid out, so that there will be no money left once all beneficiaries have passed away, currently estimated by the Actuary to be in 2070.

Who can change the Scheme Rules?
Only the Government has the power to change the Scheme Rules.

Can the Trustees wind up the Scheme and divide the money between Scheme members?
No. The Trustees do not have the power to wind up the Scheme.

Do the Trustees consult with any other bodies such as members, campaign groups, MPs or Unions?
It is the Trustees’ responsibility to manage the Scheme in accordance with the Scheme Rules and in accordance with overriding pensions and trust law. The Trustees do not take representations from any third parties with regard to policy. The Trustees try to respond to questions or requests for information from individuals or groups that have a valid interest in the Scheme, such as Scheme members, MPs or mining trade unions. The Trustees’ policy is to provide only factual, publicly available information to those groups and individuals and not to discuss Trustee policy.