UK - British Aerospace has agreed to take on a greater share of its pension schemes' deficit and increase contributions over the next three years.
The company’s proposals are outlined in an internal memo sent to employees which was passed on by a source.
The memo said: “The company’s final position aims to offer both the business and members an affordable solution to retain final salary benefits, and the approval of the trustees will now be sought.”
The move follows an in-depth consultation with employees and unions on the health of the £9bn fund.
Proposed changes will see BAe taking on a greater proportion (60%) of the cost needed to save its seven schemes, which have a combined FRS17 deficit of £2.16bn. The increased cost was previously going to be split between the company and employees.
BAe has agreed to increase contributions for three years with further consultation at the end of that period.
The memo added: “Members will be the first to benefit if future improvements in the funding position result in reduced contributions.”
But union leaders say there is some way to go to keep workers’ contributions to an “absolute minimum” and refused to rule out further industrial action.
T&G national organiser Jack Dromey said: “The message from the members is unmistakable – if the company demands too much, they will take industrial action.”
Most respondents in this week's Pensions Buzz do not think businesses should be able suspend AE contributions if in financial distress.
Former BHS owner Dominic Chappell has lost the appeal against his section 72 conviction and sentence for failing to hand over information to The Pensions Regulator (TPR).
This week's top stories include Marsh and McLennan Companies agreeing to buy JLT, and the home secretary calling for AE to be scrapped in a no-deal Brexit scenario.
Lesley Titcomb says the watchdog wants closer interactions with pension funds to spot problems sooner and act before having to use its more stringent powers