General   (General discussion, talk about anything.)

Peter
This was your union’s position re surpluses when the industry was nationalised in 1994.

The Coal Industry was privatised in December 1994 and because of this contributing members of the BCSSS became deferred (preserved) members in the BCSSS.
On privatisation, the Government Guarantee was established and the BCSSS was split into four ‘Sub-funds’ as a result:
The Guaranteed Fund, which paid the pensions that members earned when contributing to the Scheme, including all the benefit improvements awarded before privatisation. These pensions, including annual increases, are fully guaranteed (Guaranteed Pensions).
The Bonus Augmentation Fund, made up of the 50% members’ share of surpluses after 1994. Benefits paid from this Sub-fund were usually awarded as bonuses, payable for life. However, they were not guaranteed and, if insufficient funds were available, they could be reduced (known as standstill).
The Guarantor’s Fund, was made up of the Government’s 50% share of the surpluses arising after 1994. These were paid to the Government over a 10 year period.
The Investment Reserve, made up of British Coal’s remaining share of the surplus in 1994. This was due to be repaid to the Government by 2019. The Investment Reserve has acted as a buffer which protects members’ bonuses and provides some protection for the Government having to make new contributions.