Economy

BA seeks to close main pension scheme

BA seeks to close main pension scheme”

"If NAPS remained open to future accrual, the cost to the company of providing future benefits to NAPS members could rise to 45% of individuals' pensionable pay in 2018 - more than four times the typical employer contribution of United Kingdom airlines".

Thousands of British Airways employees' retirements have been plunged into uncertainty as the carrier announced proposals to close its defined benefit scheme.

BA is in the middle of a long-running legal spat with members of NAPS' predecessor, the Airways Pension Scheme (APS).

There are about 17,000 people in NAPS and more than 20,000 in the airline's defined-contribution pension scheme, known as BARP.

Despite claiming this would yield "improved terms for the majority of United Kingdom colleagues", BA faced a veiled threat from the Unite and GMB trade unions of fresh strikes, adding to 85 days of industrial action so far this year.

"We will be proposing new pension arrangements that will improve benefits for the majority of United Kingdom colleagues", British Airways said in a statement, adding NAPS, which has some 17,000 BA staff members, would be closed to future accruals but the pension benefits already earned would be protected.

British Airways said the NAPS scheme's deficit hit £3.7bn in March this year and that it was the largest of all United Kingdom company pension black holes relative to the firm's overall value. The figure comes in spite of the fact the airline said it had paid £3.5bn into the scheme since 2003. "If Naps remained open to future accrual, the cost to the company of providing future benefits to Naps members could rise to 45% of individuals' pensionable pay in 2018 - more than four times the typical employer contribution of United Kingdom airlines".



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