BA unions agree on pension plan cuts

The British Airways trade unions have announced than plans to aid financial restructuring through an agreement to reduce two separate final-salary pension schemes.

The company is presently around £3.7 billion in debt and is desperately attempting to roll-out a number of savings plans, some of which have caused concern amongst staff members – notably the ongoing dispute over changes to working conditions by cabin crew which has resulted in the forthcoming strikes.

The GMB, Balpa and Unite unions have all agreed that the larger of the two pension schemes, covering future pension entitlement, will be grown at a significantly reduced rate. Staff will also be offered the option of contributing an additional 4.5 percent of their salaries to main the current benefit level. This deal is unrelated to the current cabin crew dispute.

The request to reduce pension schemes is the second in the past three years that New Airways Pension Scheme (NAPS) members have agreed to, on both occasions as a gesture of goodwill to assist the airliner reduce operating costs.

British Airways operates two pension schemes. The Airways Pension Scheme (APS) that is predominantly pensioners who retired or signed-on before the plan’s closure in 1984, and the NAPS scheme which shut its doors to new members in 2003. The latter currently has around 30,000 staff members. The latest announcement means that pension plan members will themselves pay an additional £37 per annum to maintain their existing benefit.