Steel union leaders have confirmed workers at the Caparo plant in south Wales will begin industrial action over a pension dispute.

ISTC general secretary Michael Leahy said management at Tredegar and Scunthorpe had failed to listen to pleas not to scrap workers' final salary pension scheme.

The ISTC have threatened strike action

Steelworkers at both plants will walk out in protest on 17 July and repeat the industrial action each successive Wednesday until an agreement is reached.

Workers at the Caparo Wire plant in Wrexham are being balloted on strike action, with the result expected by Friday.

The industrial action to defend pension rights is the first of its kind in the UK.

Mr Leahy said the Carparo management's failure to discuss the matter was "surprising and disappointing".

"We urge the company even at this late stage to suspend this unnecessary action and sit down and talk with us in a spirit of partnership and consultation," he said.

'Money before people'

"Otherwise the speculation will be that, after enjoying a 10-year payment holiday from the scheme, the company, which has prided itself on its family values, is simply putting money before people."

The Caparo Group, owned by Labour peer Lord Paul, is one of the UK's largest steel businesses with branches in Scunthorpe, Tredegar, Walsall and Wrexham.

The Tredegar workers are angry their pension scheme is being replaced for both new and existing members.

Stakeholders

Workers at the company's Scunthorpe plant carried out an overtime ban last Friday, ahead of the proposed action at Tredegar on Tuesday.

Stakeholder pensions were launched in April last year as a low-cost way for those earning modest incomes to save for retirement, and ease the burden on state coffers.

Like other pension plans, money paid into a stakeholder pension is invested in items such as stocks and shares, bonds and cash savings accounts.

However, ISTC members in Scunthorpe and Tredegar opposed to the plans have already voted to take strike action if Caparo refuse to comply with union wishes.

The union wants Caparo to suspend the scheme and meet the union to discuss other options.

Poor markets

Michael Leahy, ISTC General Secretary, said Caparo workers are "outraged" that their security in retirement is being threatened.

"ISTC members at Caparo face the prospect of a much reduced income after years of service than that which they expected," he said.

An increasing number of companies have closed their final salary pension schemes over the last few years, blaming poorly-performing stock markets, punitive taxation and a new accounting standard.

A recent poll revealed plans by a quarter of small firms to wind-up or close schemes within the next year.

In their place, companies are offering riskier schemes, known as "money purchase" plans, which pass on the investment risk to the worker.