UK drinks giant vows to wipe pension gap in seven years

UK drinks major Diageo has revealed plans to pay GBP100 million per year for the next seven years to clear its pension deficit.

According to UK media reports, the maker of Smirnoff vodka and Guinness will aim to irradiate its pension gap, which stood at GBP653 million at the end of last year, by fiscal 2014. The first GBP100 million payment will be made shortly after the next trustees evaluation of the deficit at the end of this month.

In addition to the deficit funding, Diageo will continue to make a cash contribution in respect of annual benefits awarded to active members, which in the year ending June 30, 2006 is expected to be GBP50 million, Reuters quoted the company as saying.