Yes former miners do receive free coal or most likely coke or its equivalent(nuggets). Ex miners who live out in the sticks are the only ones allowed to receive coal. In the towns it must be manufactured nuggets which are burned mainly on Parkray type inset fires/boilers which supply heat to a heating system as well as providing hot water to the taps.
For many years the free fuel allowance could be swapped for a one off cash payment. A lot took this option and installed gas central heating. Because ex miners living in the sticks don't have mains gas they were allowed to burn coal. I don't know what they will do now although because coal cannot be bought by the public it is possible that these ex miners may still receive their coal/nugget allowance. If this is the case a few thousand extra trees will have to be planted to keep the carbon neutral balance!