UK - BAE systems has reached an agreement with its staff to retain the final salary pension scheme and also tackle the £1.4bn deficit on the main pension scheme.
BAE staff - including company executives - will take responsibility for 40% of future increase in liabilities.
The main scheme originally had a £2.4bn deficit, but a similar agreement reached in 2003 helped reduce it by £1bn, a company spokesperson said. “The difference this time is that it does not involve members of pension scheme dipping into their pockets, but rather we are just changing the conditions [of the scheme] in the long term.”
The spokesperson said it was impossible to determine how much it would save the company, but said the main achievement was securing the final salary scheme.
“We are still going through the process, and there will be more to say on savings in due course. It is quite complex, but what we managed to do is retain the final salary scheme, which is why people are pleased.”
The agreement was reached after a lengthy consultation period with staff, and BAE now has the support from both unions and employees, the spokesperson said. “Next we will go to the trustees, which will be in the next few weeks.”
By Damian Clarkson
This week's top stories included Cardano announcing plans to acquire Now Pensions from a Dutch pension fund later this year.
Royal Bank of Scotland (RBS) faces a £102m impact on liabilities as a result of equalising guaranteed minimum pensions (GMPs), according to its annual results.
Malcolm Mclean says getting the channels of communication right and engaging more openly is a good starting point