British Airways' pension deficit move agreed

A move towards tackling British Airways' £3.7 billion pension deficit was agreed today, the airline announced.

The development, which is unconnected to the current cabin crew dispute, followed talks between the company and unions representing pilots, baggage handlers and other employees.

BA said: "British Airways has concluded consultations with its joint trade unions on the future benefits of its defined benefit pension schemes.

"This is an important step forward in the process of addressing the pension deficits which the trade unions will be recommending to their members. The new benefit structure will be proposed to the trustees and form part of the negotiations towards a recovery plan that is expected to be presented to the Pensions Regulator by June 30.

"The proposals are intended to avoid the closure of the pension schemes and maintain British Airways' contributions at the current level of £330 million per annum."

Under the main proposal, pension scheme members can receive lower future benefits and keep their current levels of contribution or opt to pay an extra 4.5% to maintain their existing pension benefits.

BA said there will be a mechanism to help offset the impact of contribution increases on lower paid employees.