From 1980 to 2015: An Historical Perspective on the Tata Steel Pensions Dispute

As someone more used to writing about the past than the present, it is with some caution that I approach the current – and as yet unresolved – disagreement between Tata Steel and the main steelworkers’ unions over the future of the British Steel Corporation pension scheme. Being neither a Tata Steel employee nor a trade union representative I can only reiterate the facts that have been made public. Earlier this year Tata Steel, owners of the majority of Britain’s steel industry including the country’s largest plants at Port Talbot and Scunthorpe, announced the decision to end the British Steel Corporation pension scheme, a scheme that has been in existence in something like its current guise since the 1970s. The company have declared the scheme to be financially unviable owing to the advancing age of its members and the declining number of the active workforce contributing to it.

In response to Tata Steel’s decision, Community (the largest union representing steelworkers) and most of the industry’s other unions (including Unite and GMB) have decided to ballot their members for strike action. A majority endorsement by steelworkers of the unions’ proposals would result in the first national strike in the industry since 1980 and only the second ever national strike in its entire history. The unions have stated that Tata Steel’s management have failed to undertake proper consultation over the pension scheme’s termination and question the company’s financial evaluation of its continued feasibility. Being privy to neither party in the argument, it is not my intention here to offer an opinion as to who is right or who is wrong. Instead, I want to place the current tensions in an historical context and consider why the pension issue has proved such a volatile concern and one which has taken the industry to the brink of its first national stoppage in thirty years.

The British steel industry looked rather different the last time it experienced a national strike. In 1980 there were around 100,000 people working in an industry that was mostly owned by the state. Up to 1980 the steel industry had been through a decade of financial uncertainty and contraction and the future looked bleaker still, with the Shotton steelworks earmarked for closure and massive redundancies announced for the Port Talbot and Llanwern plants. The 1980 steel strike, however, was not called over job cuts or plant closures but pay. Unlike closures and redundancies, the pay issue united the majority of steelworkers; it was a national issue that transcended the industry’s inter-regional factionalism and presented the only feasible grounds for collective action.

For the Iron and Steel Trades Confederation (now Community), the decision to strike was a reluctant one. Since its inception in 1917, the union has prided itself on its political moderation and conciliatory approach to industrial relations. One historian described its politics as ‘well to the right of the trade union movement’. Throughout much of the post-war era, the union’s national executive had been quick to quash unofficial strike action by its members and eschewed the strident class rhetoric espoused by its counterparts in the National Union of Mineworkers and the Transport and General Workers Union. Management and steelworkers were not alligned against each other but mutually vested in the industry’s continued prosperity, so they maintained.

The Iron and Steel Trades Confederation’s approach to industrial relations, then, was overwhelmingly pragmatic: it wanted to get the best deal for its members and, for the most part, this meant the best wages and workplace benefits. Throughout much of the 1950s, 60s and 70s the union was incredibly successful in achieving these goals. Steelworkers were amongst the best paid industrial workers in Britain and their pension was widely regarded as one of the finest available to manual workers.

By 1980, however, steelworkers’ position within the upper tier of the labour aristocracy had been significantly undermined by a gradual decline in real earnings and widespread job losses. The decision by the Iron and Steel Trades Confederation to strike that year not only evidenced the genuine grievances of their members but also the union’s longstanding commitment to defend steelworkers’ privileged economic status. For the union, to accept the meagre two per cent pay award offered by the government of the day would have been to negate their raison d’etre. The unprecedented decision to call a national strike was the only option.

The industry has changed significantly since 1980 – most obviously there are far fewer plants and far fewer steelworkers – but there are some clear parallels with the current dispute. Once again it is a change to steelworkers’ material status and economic position (albeit their post-work settlement) that has acted as the catalyst for discontent. The pension scheme is also an issue that affects all steelworkers (or at least all Tata Steel employees) and as such has the potential to command national support.

The will of the unions to advocate the most powerful tool at their disposal is also insightful. In the three decades since 1980 the number of jobs lost in the industry has been vast and some of the country’s biggest plants, such as Ravenscraig and Ebbw Vale, have been closed. No national strike was called. The steel unions campaigned ardently against plant closures and sought to mitigate the worst effects of redundancies but, ultimately, the national strike threat was never sanctioned. The unions’ leadership knew it would be hard to galvanise national support for local or regional issues and it was difficult to intransigently resist job cuts whilst maintaining a commitment to support industrial modernisation and technological investment. Instead the unions focused their efforts on their core priorities: protecting the financial position of their remaining members and defending the workplace benefits they had already secured, with the pension being the most precious.

Amongst the former steelworkers I interviewed, their pensions remained one of the most prized assets of a career in the industry. For many it was a deserved reward for a lifetime spent working in a, sometimes, dangerous, demanding and physically exerting environment. The prospect of taking early retirement at fifty-five or sixty (a right it is claimed Tata Steel is seeking to revoke) was also highly valued. Some felt that the physicality of their work made early retirement a necessity rather than an additional benefit. The importance steelworkers attached to their pensions is clear in their oral testimonies; a few relevant sections of which are repeated below.

But the big bonus for anybody working in the steel industry is the retirement, the pension scheme – that is the carrot. You don’t think of it earlier on in your working career but later on you think how fortunate you are, if you’re lucky enough to survive, there’s light at the end of the tunnel.

My father was a humble man, he had no pension – nothing. So I must have been an old or future looking man when I was young because I was looking for pension; at the age of 21 that’s a hell of a thing to do isn’t it?

The position that came up with the Steel Company of Wales was long term and most importantly, because of the position with my father who finished work with absolutely no pension, I thought my main aim is to get in somewhere where I’m going to work for the rest of my working days and finish work with a good pension at the end of it.

Undoubtedly the decision to end the British Steel Corporation pension scheme has been a source of considerable consternation and condemnation amongst the company’s employees; last Saturday’s march and demonstration in Port Talbot attracted hundreds of steelworkers in a scene reminiscent of 1980. Whether this public expression of opposition reflects a collective will to strike will be seen when the results of the strike ballot are returned over the coming weeks.

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