The financial future of thousands of former miners was thrown into doubt last night after Britain's last coal company collapsed into administration.
More than 3,000 former miners will see their pension entitlements slashed by 10% under terms of a rescue deal from UK Coal, the Daily Mail reports.
The UK's pension safety net, the Pension Protection Fund, will take control of the company's scheme including its £543m liability.
A restructuring of UK Coal last year was supposed to have salvaged the group's fortunes.
But after a major fire earlier this year at Daw Mill, its largest pit in Warwickshire, both the mine operator and its holding company will enter administration.
The fire, which closed the mine in March, meant the company could not continue to pay its bills.
The group runs six surface mines and two deep mines in Britain, and accounts for 10% of the UK's annual coal consumption, producing 5m tonnes a year.
Its viable mining outfits will be put into a new company UK Coal Production Limited and run as an employee trust.
Around 2,000 jobs were saved by yesterday's deal, but 350 roles at Daw Mill mine will go, the group said.
Chief executive Kevin McCollough said: ‘Today is very much a day of mixed emotions, but this is the best outcome that it was possible to achieve.
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