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Pilkington pension fund deficit 'in region of £300m'
10:28am Monday 4th February 2013 in News
THE troubles at struggling glassmaker Pilkington deepened after a union revealed the company has a deficit in its pension fund in the region of £300million.
GMB raised the prospect of industrial action as it announced a consultative ballot of its 500 St Helens members about whether to reject potential sweeping pensions changes.
The union describes Pilks’ proposals as “Draconian”.
It claims the introduction of a cap on pensionable pay will erode past and future benefits by at least a fifth - and up to 40per cent for younger members.
The news comes on the back of Pilks, whose parent company is Japanese-based Nippon Sheet Glass, announcing it is cutting 120 jobs in St Helens.
Thirty three positions at Watson Street and 87 across the Greengate and the Cowley Hill float plants will be axed, as previously reported.
It follows a drop for demand in glass markets across Europe.
The slump has led Pilks to mothball its UK 6 line, and place furnaces at Watson Street and Cowley Hill on “hot hold” until April.
Charlie Leonard, a GMB senior organiser, conceded the company is making “heavy losses” but vowed to challenge compulsory redundancies and proposed pension measures.
He said: “Even though the manufacturing outlook is gloomy in the short run, our members are prepared to stand up and fight against these detrimental and Draconian proposals to reduce their pensions which will apply in the longer term.
“We are presently undergoing a consultative ballot of our members within Pilkington Glass to see whether or not they want to accept or reject the company’s proposals on pensions.
“This could well lead to a ballot for industrial action if the company does not change its position.”
Pilkington admitted there is a “significant deficit” in its pension scheme and admitted it is working to agree a recovery plan by the March 31, 2013.
“In the current environment some changes must be made to enable the Scheme to remain open to limited future accrual.
“Even with the proposed changes, a deficit will remain and needs to be managed.”
It described the jobs losses as a “completely separate” situation, adding that is working with trade unions to reach the required numbers through voluntary redundancies.