The BBC is the latest UK company to announce plans to axe its final salary pension scheme for its employees in a move that has been condemned by unions.
The broadcaster has proposed that staff work until they are 65 rather than 60, contribute more into the scheme and accept a lower payout that is based on a career average instead of a percentage of their final salary. Employees over 50 will be unaffected by the changes.
BBC director general Mark Thompson said: The pressures on the scheme mean that for it to remain secure and affordable, we have to make some changes both to its benefits and to the level at which it is funded by the BBC and its members. Doing nothing is not an option.
Bectu, a union that represents those working in broadcasting, said that the changes were unnecessary as a recent audit found the scheme still in surplus. The union said that strike action could not be ruled out.
Assistant general secretary Gerry Morrissey said: The pension scheme has a surplus but it is choosing to close the scheme, reduce the benefits and expect staff to pay more for them. This is unnecessary, unacceptable and pandering to the BBC’s political opponents who wrongly believe that BBC staff are being feather-bedded.
Final salary schemes at several companies have been closed to new members due to large deficits. The longer life span of members and falling investment returns have been blamed for the failure of the schemes to fulfill their obligations.