STEELWORKERS on Sheppey, seeking compensation for the collapse of their pension schemes, are taking their fight to the European Court of Human Rights.

The trade unions, Amicus and the Iron and Steel Trades Confederation (ISTC), have begun legal action against the Government.

A £1 million fighting fund has been set up by the unions to cover the legal bill. A letter has been sent to the Government warning that a High Court writ will be issued against them in 21 days unless compensation is offered to the former employees of Allied Steel & Wire Sheerness and other workers in a similar position.

Sittingbourne and Sheppey MP Derek Wyatt (Lab), who is backing the legal action, urged the Government to help the steelworkers rather than fight them in the courts.

He said: "I think the Government is on weak ground and will lose. They have to work out if they put up £1 million of taxpayers' money and fight or just pay retrospective compensation.

"It will take 18 months to two years for a legal ruling. It is better for the Government just to come clean and do it."

Steelworkers at ASW Sheerness are fighting for retrospective compensation to be included in the Pensions Bill, due to be heard in Parliament at the end of the year. Their final pension schemes collapsed when ASW went into receivership last year, with many set to lose up to three quarters of their pensions when they retire.

The Government is considering legislation to protect workers in the future, but this will not help employees of firms that have already gone bust.