UK - BAe Systems has agreed to take on a major share of the costs needed to plug a £2.16bn deficit across its seven schemes.
Originally, the firm had suggested splitting the costs equally with staff members.
But, its revised offer to meet 60% of the additional funding has now been approved by trustees.
A memo to scheme members sent by a source says: “The changes were subject to the approval of the trustees who, after extensive consultation with their professional advisers, approved the changes.”
Final salary benefits will be maintained for all existing members and any contribution increases will be phased in over the three years following actuarial evaluations.
BAe’s offer also stipulated that, in the event of future improvements in the scheme funding position, members would benefit first.
Last month BAe was downgraded by ratings company Standard & Poor’s to triple-B – just one place above junk level.
The firm also saw its credit rating cut by Moody’s Investor Services from A2 to Baa1 – three places above “junk” level.
And earlier this month, accounting giant PricewaterhouseCoopers warned that banks are reviewing loan arrangements to companies with DB scheme deficits, such as BAe.
Paul Budgen is set to join financial technology and auto-enrolment (AE) firm Smart Pension as director of business development.
This week's edition of Professional Pensions is out now
Collective defined contribution (CDC) schemes will need clear and transparent governance frameworks, as well as effective communication strategies, to be a success, the Work and Pensions Committee (WPC) has been told.
The aviation sector's constant evaluation of mistakes to improve safety should be applied to defined benefit schemes, as too many are making the same mistakes again and again, latest research shows.