Morrisons set to freeze final salary schemes

In its 2009 AGM and first quarter interim management statement the supermarket firm said it wanted to put its DB schemes onto a "sound financial footing".

It said it had already injected £200m into the schemes, reduced - in consultation with the trustees - the funds' exposure to equity investments and implemented more prudent mortality and other assumptions.

The statement said: "Following successful consultation with our pension scheme members, we are now in position to conclude the process of putting our defined benefit pension schemes onto a sound financial footing for the long term"

It added: " The final step, to be implemented at the half year stage, will be to move all future benefit accrual onto a career average basis, such that it will grow in line with inflation rather than being linked to final salary."

The supermarket said the closure of the schemes to future accrual was expected to result in the recognition of an exceptional credit in the income statement at the interim stage.

This comes just days after Barclays said it was set to close its final salary scheme to future accruals as part of a review of its pension arrangements (PP Online, June 3).

The bank proposed that benefits relating to future service by existing members of the Barclays UK Retirement Fund - which was closed to new members in 1997 - would be provided by the cheaper hybrid cash balance pension scheme, Afterwork, it currently offers new staff.

The bank said a formal two-month consultation process with scheme members and trade union Unite on the proposals to freeze the scheme had now begun.

This also comes as BP announced it was set to close its UK final salary pension scheme to new members from April 2010 (PP Online, June 3).