IAG Subsidiary British Airways Opens New Flexible Benefits Scheme

3rd Apr 2018 12:10

LONDON (Alliance News) - FTSE 100-listed International Consolidated Airlines Group SA said on Tuesday its subsidiary British Airways has opened its new benefits scheme, the British Airways Pension Plan.

This follows the closing of the New Airways Pension Scheme to future accrual and the British Airways Retirement Plan to future contributions at the end of March.

The new scheme will offer a choice of contribution rates and the ability to opt for cash instead of a pension. Its annual costs is also expected to be GBP80.0 million lowers than the previous schemes' costs in 2017.

Members of the former scheme have been offered a choice of transition arrangements, which will incur cash transition costs of GBP169.0 million, and a reduction in IAS19 liabilities of GBP770.0 million due to some members choosing a non-cash option to increase their pensions.

For the first quarter of 2018, the liability reductions, retirement plan closure costs and impact of cash transition payments will form an exceptional gain of GBP598.0 million.

"This is an important step in managing the risk in NAPS and ensuring the airline has an appropriate cost-base for the future. The new arrangements include a market-competitive defined contribution scheme and will stop the build-up of further liabilities and risk in NAPS. This will help to improve the security of existing benefits," said British Airways Chief Financial Officer Steve Gunning.

Shares in International Consolidated Airlines Group SA were down 1.3% at 606.80 pence on Tuesday.

---

Related Shares:

International Airlines