This battle, which will return to the negotiating table this week, has repercussions nationally and the way Britain handles it is being watched globally. The t-shirt slogan of the marchers summed up the problem succinctly: "Fighting for our Pension".

Ineos, the firm which acquired the refinery from BP three years ago, wants to end its final-salary pension scheme, require current members to contribute six per cent, which will be phased in over six years, and adopt a different plan for newcomers.

Employees at Grangemouth enjoy an exceptional pension package. They receive a pension of 1/60th of their final salary for every year worked and do not contribute a penny.

Such deals are simply not sustainable and there is a yawning gulf developing between those in such final salary schemes and defined contribution plans, where the funding is by both employer and employee and depends on how the investment performs.

A typical employee with defined contribution scheme retiring now from the private sector will receive £7,675 annually. By comparison, public sector staff in final salary schemes can expect £45,451 (for an NHS doctor with 40 years service) or £28,518 (for a teacher), according to a study by stockbrokers Hargreaves Lansdown.

With only 17 per cent of staff in the private sector in final salary schemes – down from 34 per cent in 1997 – few companies are admitting
new entrants.

This is going to create a new elite group of pensioners, composed largely of former public sector employees and a small minority of final-salary scheme private sector staff.

The Treasury will either have to make major savings or raise taxes to fund future public sector pensions, which are calculated to soar from £25m to more than £1 trillion.

Parliamentarians who debate such issues are not immune. Those who have been elected fairly recently will benefit significantly. Gone are the days when there was no pension provision.

The current Westminster pension pot has a deficit of almost £50m, most of which will need to be made up from the public purse.

Despite this, Gordon Brown still seems oblivious to the damage caused to pensions by his 1997 action when Chancellor to take about £5bn annually from pension funds. This action caused many companies to give up their final-salary schemes. Ineos says it is already paying 25 per cent of its wage costs to former staff and that this could increase to one-third within a decade.

This stubborn attitude is seen elsewhere. It took years of campaigning and media pressure to force the Government to compensate the thousands of pensioners who lost out when their schemes failed. Finally, last December, it agreed to pay £2.9bn to 125,000 people through a financial assistance scheme.

Far greater supervision of pension plans needs to be undertaken. It is appalling that the Financial Services Authority failed to properly supervise Equitable Life and still denies compensation.

Where contributors depend on investment performance, there needs to be transparency as to where their money is going.

One of the most effective ways to publicise such investment would be to publish an annual plan which revealed where pension providers had placed the funds. This might, for instance, be in constructing a shopping arcade. In Germany, such booklets proved a major bulwark against nationalisation and are an incentive to save as well as to support enterprises that are linked to future pension provision.

Those in with-profit plans are demoralised when they receive letters saying that no annual bonus will be applied and that instead they should depend on a terminal bonus. This is no way to plan for retirement and depends far too much on the whim of the appointed actuary of the moment. No wonder a firm like Norwich Union is planning to change its name.

Taking control of your own planning through a self-invested personal pension (SIPP) brings responsibility and can help to ensure better investment balance of one's total portfolio. Specialist advisors are available for those who lack the investment skills.

To add to our pension problems, the credit crunch will cause many younger staff to cancel or curtail their contributions. Yet this is precisely the age group who should be building up a pension and can afford to invest in expanding markets like Brazil, India and China. Over 20 years, just £100 saved monthly would yield £52,468 in the average balanced managed pension fund but over £100,000 in an Asian or global emerging fund.

Financial education in schools and colleges is still under-developed and not fully resourced. Yet even teenagers see the necessity for retirement planning when a basic weekly state pension pays only £90.70 or, for a married couple, £145.01.

Grangemouth should not be dismissed as an industrial dispute but recognised as a pension wake-up call that must be acted upon with urgency.

Conal Gregory is Personal Finance Regional Journalist of the Year and was Conservative MP for York from 1983 to 1992. His weekly column appears in Saturday's Yorkshire Post.