UP to 400 workers at Birmingham Airport are to be balloted on a hard-won pension U-turn which would see their final salary scheme retained despite a deficit of £26 million.
Union negotiators fighting to preserve the scheme in the face of the large shortfall have hailed the proposals as the “best deal that can be achieved through negotiation.”
The compromise, which would still see benefits in respect of future service reduced by 30 per cent for final salary scheme members, has been achieved following six months of tough negotiations.
Unite regional officer John Partridge said: “It looks as though we are finally going to do a deal to retain the final salary scheme. By our dogged persistence, we have managed to keep some form of the final salary scheme. I am very pleased. Workers had a letter back in April saying this scheme was going to close, no ifs or buts, and now it is not.
“Workers will have a choice – some people, especially those further away from retirement, may take a choice of going into a defined contribution scheme. The nearer people are to retirement, the closer they will get to what they expected. There is now going to be a series of one-to-one and group meetings during December to explain the detail.”
The airport announced plans to close the scheme and launched a 90-day consultation programme earlier this year after the retirement fund ran up a deficit of around £26 million.
In a letter to scheme members, Mr Partridge and fellow regional officer Peter Coulson say: “We can now report that the company has agreed that the Defined Benefit or final salary scheme will continue although in an amended form and members can choose to remain in it or transfer to the Defined Contribution scheme. Considering the airport’s determination to end the scheme from the outset of the talks we do believe it is the best deal that can be achieved through negotiation.”
The ballot of members will take place in January. The airport has not commented while talks with the unions have continued.