Former miners have said they are delighted their “hard-fought campaign has finally paid off” after the government said it would end the pension scandal that left many of them “dying in abject poverty”.

In her first budget on Wednesday, Rachel Reeves announced the £1.5bn mineworkers’ pension fund would be handed over in its entirety to ex-miners and their families, after years of campaigning on an unjust agreement that allowed the government to take half of their pension surplus. The pensions of 112,000 former coalminers will rise 32% – an average increase of £29 a week – from November this year.

Campaigners and Labour credited the Guardian for bringing attention to the scandal, which began in 1994 when the Conservative government pledged to guarantee the Mineworkers’ Pension Scheme in exchange for half its surplus, without sufficient input from the miners who paid into it.

Charles Chiverton, a spokesperson for the National Mineworkers Pension Campaign, said former miners were pleased to see the chancellor “address the historical injustice of the mineworkers’ pension scandal that has disadvantaged thousands of miners over 30 years”.

He said: “Over 300,000 miners and their families have been punished to the grave, men who fought in two world wars and helped rebuild the country afterwards. It has been a very long hard-fought campaign with many stories of hardship, pain and suffering.

“Some miners and their families could not even afford the burial of their loved ones, while government stole billions. The indignity of not even being able to plan a short break or a day out, all while there were millions being skimmed off the top of their pension scheme and going into the exchequer in the form of tax times two.”

He thanked the government for taking action when previous administrations had failed to do so.

The National Mineworkers Pension Campaign said the former prime minister Boris Johnson had “lied through his back teeth” when he promised in 2019 to end the deal.

The energy secretary, Ed Miliband, said: “We owe the mining communities who powered this country a debt of gratitude. For decades, it has been a scandal that the government has taken money that could have been passed to the miners and their families. Today, that scandal ends, and the money is rightfully transferred to the miners. I pay tribute to the campaigners who have fought for justice – today is their victory.”

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