BA to lower retirement age to 60
British Airways has agreed to lower the retirement age for staff to 60 in return for increased contributions in an effort to tackle its £2.1 billion pension scheme deficit.
The airline has also agreed to raise its annual contributions from £235 million to £272 million.
The concessions emerged following a meeting with unions over the New Airways Pension Scheme (NAPS).
The meeting came after agreement in principle was reached between the airline and the NAPS trustees on a funding plan to pay off the deficit – but this remains subject to staff accepting benefit changes.
A pilots union spokesman reportedly said the two sides were “still some way apart”.
A major issue for the staff and unions has been raising the normal retirement age to 65 from 55 for aircrew and 60 for ground staff, BA admitted.
The airline has now included the option of a normal retirement age of 60 in return for increased contribution rates. For ground staff this will mean an increase from 5.25% to 10% and for air crew for the first five years 6.5% to 11.25per cent. After five years, rates will be harmonised at 10% for all.
BA chief financial officer Keith Williams said: “We recognise that normal retirement age was a sticking point and we have put forward an option that allows staff to retire at 60. Staff can still choose not to pay any extra but it will mean working longer to get the same pension.”
Report by Phil Davies
Phil Davies
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