The trustees of the Mineworkers’ Pension Scheme say the Government declined to release approximately £1 billion of undistributed pension surplus for an additional bonus this year, even though an agreement had been ready for signature ahead of the 28 October Budget.
Deal withdrawn before Budget
According to the trustees’ statement of 28 October, an agreement had been ready to sign with minister Blair McDougall. At a meeting the day before the Budget, however, Government representatives said they would not permit the approximately £1 billion undistributed surplus to fund a new bonus pension in 2026. The trustees say ministers cited Government accounting rules.
Important concessions announced
Chancellor John Healey announced that members would benefit from 100% of future scheme surpluses, ending the previous 50/50 sharing arrangement. Ministers also agreed to end the standstill mechanism so bonus pensions paid since 2024, and future bonuses, are protected. Trustees welcomed those changes but said the existing undistributed funds would remain locked up.
No immediate payment or deadline
The Chancellor committed to working towards the full transfer of the remaining Guarantor’s Fund. Trustees cautioned that this was neither a guarantee of immediate payment nor a specific timetable. The money remains within the scheme; it has not been newly paid to the Treasury. No additional bonus from these funds will be paid this year.
Labour MPs press Treasury
Labour MPs representing coalfield constituencies urged the Government to reconsider. The Coalfield Group wrote to ministers seeking immediate release of the remaining funds. Chief Secretary to the Treasury Emma Reynolds confirmed that ministers were continuing discussions with Labour MPs and acknowledged that the transfer could not be completed at the Budget.
Why the dispute matters
The surplus-sharing arrangement dates to the privatisation of British Coal in 1994, when the Government agreed to guarantee pension benefits in return for a share of investment surpluses. In 2024 the Government transferred the MPS £1.5 billion investment reserve to benefit members, increasing average pensions by approximately £29 a week. Trustees contrasted the current refusal with the previous £2.3 billion reserve transfer to the British Coal Staff Superannuation Scheme.
Union warns of further delays
The National Union of Mineworkers welcomed the end of future surplus sharing but said it was disappointed that the remaining Guarantor’s Fund had not been released. The union warned that many elderly scheme members may never benefit if the issue is left unresolved. Trustees plan to update members through meetings and further communications.
What happens next
The Government says it will continue work towards transferring the remaining fund, but no firm date has been announced. The distinction remains between confirmed improvements to future surpluses and bonus protection, and the unresolved transfer of existing undistributed money.