Pension deal saves ‘Big K’

Kellingley Colliery
Kellingley Colliery

A deal has been struck between pit bosses and a pension rescue fund to secure the future of Kellingley Colliery and its 700 workers.

UK Coal has called in the administrators after a devastating fire ravaged their Daw Mill mine in Warwickshire earlier this year.

The blaze cost the company £160m in coal and £135m in equipment and closure costs, threatening the future of UK Coal’s remaining two deep mines, six surface mines and thousands of employees.

But the company announced today it will restructure the business, with the loss of 350 Daw Mill workers to save 2,000 jobs over all.

Andrew Mackintosh, director of communications for UK Coal, said: “It’s great news for everyone at Kellingley, where it’s business as usual.

“There’s disappointment for their colleagues at Daw Mill, but this is the best possible outcome. It’s a fabulous day for Kellingley and a huge relief for the remaining 2,000 employees.”

Both UK Coal Mine Holdings Ltd and UK Coal Operations Ltd will cease to exist and their pensions schemes will transfer to the Pension Protection Fund (PPF).

The mining operations will be held in individual companies owned by a new business called UK Coal Production Ltd.

The PPF will not own the new company, but will take on the pension schemes’ assets and liabilities and provide compensation for its members.

Chris Kitchen, secretary of the National Union of Mineworkers, said the news will safeguard jobs at Kellingley but some members will see a ten per cent reduction in their pension entitlement.

He said: “It’s good news for Kellingley as it gives those members a viable future, but the pension is going to be an issue, because PPF benefits are less than what workers would have got originally.”

The Express launched a petition in May to help save the Weeland Road from closure, which was backed by the community, workers and politicans.

MPs Nigel Adams and Yvette Cooper, whose Selby and Pontefract constituencies include the colliery, welcomed the news.

Mr Adams added: “I’m delighted that a deal has been struck to safeguard the future of ‘Big K’ and the 700 jobs.

“It’s been a very difficult few months for everyone but I’m pleased that between UK Coal, the government and PPF this deal has been done.”