UK - The RAC has chosen to keep its £400m final salary scheme open following a triennial review.
But the company will be increasing its contributions to the scheme, which has a £129m FRS17 deficit, by £2.5m in the second half of 2003, and by £5m per year thereafter.
The contributions increase will bring total company payments into the scheme to £23m for 2003 and up to £26m in 2004.
Its employees are to be given the choice of increasing contributions or receiving reduced benefits from July 2003.
The increases will help pay for the removal of the minimum joining age of 25.
The moves have been welcomed by T&G union general secretary Bill Morris, who said: “The firm has demonstrated its commitment to a long-term solution to a difficult issue.”
RAC chief executive Andy Harrison said: “The actions we are taking will secure the future of our pension scheme, which provides a valuable benefit to all our people.”
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