THE Government last night faced fresh calls to rip up a controversial pensions agreement depriving retired coal miners of billions of pounds.

About £5bn has gone the way of the Government since agreement was reached eight years ago to underwrite two industry pension schemes in return for a share of half the surpluses.

Meanwhile, many former North-East mineworkers continue to struggle on pensions which average little more than £45 a week.

The Northern Echo can reveal that despite the market value of the pension fund having fallen, the Department of Trade and Industry (DTI) last year transferred £412m into its coffers under the terms of the deal.

Last night, critics accused the Government of "backtracking" over previous pledges to review the 1994 agreement and said it had failed to address its fundamental flaws.

David Parry, research officer with the Coalfield Communities Campaign, said: "The Government, treasury and the trustees said about a year ago said they would review the situation.

"But since then the stock market has been shaky and lots of final salary pensions have been in trouble and they have backtracked.

"The basic problem that has still not been addressed is what they are doing with all these billions that they have earmarked for themselves."

The Government has announced a series of "targeted improvements" to the pension schemes and agreed more than a year ago to give £90m to about 600 pensioners in a lump sum payment.

But Mr Parry said this did not take away the need for a newly negotiated agreement.

Alan Cummings, former NUM lodge secretary at Easington Colliery, said: "For far too long the Government has just tinkered around the edges and not looked at any major changes to this agreement."

When the coal industry was privatised in 1994 the Government agreed to underwrite the Mineworkers Pension Scheme (MPS), which covers the majority of former miners, and the British Coal Staff Superannuation Scheme (BCSSS) paid into largely by management and clerical staff.

The aim was to safeguard the funds against any shortfall, but their performance has since outstripped expectations and during the 1990s large reserves running into billions built up.

The Government's share of the pensions are paid over to the DTI in the first place rather than the Treasury.

This has led to claims that the Government is using funds to prop up coal health compensation schemes for which the DTI has set aside hundreds of millions of pounds - a claim emphatically denied by ministers.

Both pension schemes have almost 450,000 members, 386,000 in the MPS and 63,741 in the BCSSS.

A spokesman for the DTI said the Government's agreement with the trustees of the pension scheme had been of "great benefit" adding that bonuses totalling about 30 per cent had been paid to members since 1994, which would not have been possible without its guarantee.

The spokesman said: "We have agreed a package of improvements which we believe is fair and offers real benefits to the Schemes' members and are continuing to talk to the trustees."