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Billions 'taken from pensions of our miners'.

Byline: By Martin Shipton Western Mail

The Government last night faced a storm over allegations that billions of pounds paid in compensation to miners came out of their own pension funds.

Plaid Cymru MP Adam Price launched a scathing attack on Department of Trade and Industry Minister Nigel Griffiths, claiming he misled Parliament about the origin of the money used by the Government to fund the miners' compensation schemes for lung diseases and vibration white finger.

Mr Price says up to pounds 3bn will have been taken from the miners' two pension funds by the Government by the time of the next general election, expected next year.

In an answer to a parliamentary question tabled by Mr Price, the MP for Carmarthen East and Dinefwr, Mr Griffiths - the DTI Minister in charge of coal health claims - had denied this money had been used to fund the miners' compensation schemes.

But Mr Price has subsequently obtained information which directly contradicts Mr Griffiths's reply.

The Plaid MP said, 'It's scandalous that the Government has been found guilty of using miners' own money to pay their own compensation.

'Forty years ago in Aberfan, a Labour Government used the community's own funds to remove the tip. We now have this Labour Government raiding the miners' pension funds to pay compensation for diseases contracted underground.

'The Government is clearly ashamed at what it's done but that really is no excuse for misleading Parliament. To steal the miners' money in the first place is bad enough.'

In a personal letter to Mr Griffiths, MP for Edinburgh South, Mr Price says, 'I am writing to you because I am very concerned as to the accuracy of a parliamentary reply I received from you on April 19. I asked ... 'whether the department has been given Treasury approval to retain surpluses payable to it out of the Mineworkers' Pension Scheme during the last five years to offset expenditure on liabilities inherited from British Coal'. You replied, 'No. The Government's share of any valuation surplus from the Mineworkers' Pension Scheme is released over a 10-year period and paid directly into the Consolidated Fund as Consolidated Fund Extra Receipts'.

'It took over a month to reply to my original question, in which case I can only assume that a great deal of care went into its preparation.

'It is, therefore, all the more perplexing that the answer would appear to be factually incorrect, based on exist- ing Government statements which subsequent research has uncovered.

'A statement, made by Helen Liddell as Energy Minister on December 8, 1999, contains the following note: 'Under the 1994 Coal Industry Act, surpluses received by the DTI must be paid over to the Treasury's Consolidated Fund. The Treasury has agreed that they may be retained by the DTI to offset expenditure on liabilities inherited from British Coal'.

'This statement would appear to contradict directly your reply. You will be aware as a senior and distinguished parliamentarian the gravity of any suggestion that the House has been misled in any way.

'Can I ask you to respond to the discrepancy in Government statements?

'... Finally, perhaps it would be helpful if I told you I have in my possession a letter from a former Minister confirming my fears that the reply you have given me is, intentionally or otherwise, misleading.'

The letter to which Mr Price was referring was written by Ms Liddell to ex-Plaid Cymru president Dafydd Wigley on November 20, 1999. It says, 'Under the Coal Industry Act (1994) ... all surpluses received by the Secretary of State must be paid into the Consolidated Fund. They cannot be diverted for other purposes.

'The one exception is that, under government accounting rules, receipts can be used to offset related expenditure by the department concerned. In this case, the Treasury has agreed that the DTI may, for the present, retain pension fund receipts to offset expenditure on liabilities we have inherited from British Coal, in particular those related to the settlement of health claims.

'The retention of the surpluses means that we can be confident of financing the settlements without serious disruption to the rest of the DTI's spending programmes. Where in any year the pension fund receipts exceed the health claims expenditure, the excess is surrendered to the Treasury.'

Under an agreement reached with the trustees of the two miners' pension schemes, the Government gets 50% of the annual surpluses in return for underwriting the schemes, guaranteeing payouts if there is insufficient income. But no one expected the surpluses to be as high as they have proved to be.

By next year, it is estimated that the Government will have received up to pounds 3bn in surpluses from the schemes. Payouts under the miners' compensation schemes total around pounds 2bn.

A spokeswoman for the DTI said last night, 'We have seen Adam Price's letter. The Minister will be replying in due course. It would be inappropriate to pre-empt his response.'
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Publication:Western Mail (Cardiff, Wales)
Date:May 8, 2004
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