Tata Motors has bought Jaguar and Land Rover for USD 2.3 billion. Ford said it would pay about USD 600 million towards the pension plan. Roger Madison, National Organiser, Unite told CNBC-TV18 that they are happy with the pension plan. Madison added that the Tatas expect to employ more people.

Excerpts from CNBC-TV18’s exclusive interview with Roger Madison:

Q: You have been negotiating on behalf of the Unions. Is this the kind of deal size that you were expecting?

A: Yes, in fact I was expecting the Tatas to pay more money for Jaguar/Land Rover than what they have actually paid. The Tatas have got a very good deal and this actually goes to show how desperate they are to raise cash.

Q: Is this the kind of pension benefits that would be required for both Jaguar and Land Rover?

A: Yes. The last valuations of pension showed a deficit both for Jaguar and Land Rover pensions schemes. So, Ford came into a deal with the trustees and with the trustee’s lawyers. But we are more than happy with the pension schemes. That will be fully funded and at this moment in time, it is perhaps some of the only fully funded pension schemes in the UK.

So, with the future liability falling on to Tatas, we are more than happy that the pensions provision in the future is well protected.       

Q: What would this deal mean in the sense that Ford paying USD 600 million for pension plans for both Jaguar and Land Rover? What would this mean for the Tatas? Would this mean that they will have to pay more money over a larger timeframe and has the timeframe been agreed?

A: No, it just means that the company takes on pensions in the UK. It is something that we expect from good employers that they pay into a pension scheme that we contribute as well. So, the fact that they are under funded from time-to-time is purely down to stocks and shares. We have also had times when pension schemes have had massive surpluses as well because it all depends on the stock markets.  

Q: So, there is no confusion as far as pension benefits? Have you got any written agreement as far as retaining the employees are concerned and in terms of staffing?

A: Yes, we have a written agreement with Tata on the future of the plants, on the staffing levels. In fact, the Tatas' business plan sees them employing even more people by 2010-11. So, we are looking forward to working with a very successful company whose business sense is good. We make a very good car here and with their business expertise, we see a great future for Jaguar and Land Rover here in the UK with Tata.

Q: I understand that the two together would have about 16,000 employees. When you say that you have a written guarantee on staffing, would that mean there would be no restructuring that would happen and no retrenchment is likely?

A: That is correct and that is what they have said. For the first time ever in our industry, somebody has come in and bought a car company of this size and haven't said that they need to restructure. It is again an exciting prospect to work with Tata. It is a company that is looking forward to building the business and not just looking in to slashing, cutting, making a quick buck and leaving. They are looking for a long-term investment here and to grow the business. We are very excited about that.

Q: Has there been any sort of changes or subject to negotiation as far as terms of employment with the workers of both these brands are concerned?

A: No, in fact, we have again got written guarantees and not just on job security but secure on terms and conditions as well. So, this is a real win-win situation; members keeping the terms and conditions they have got, their pensions are guaranteed, their jobs are far more secure under Tata than what they were under Ford. We are now owned by a company that has got some money to continue the investment that every car company needs.