7th Feb 2007 14:26
British Airways PLC07 February 2007 PENSION AGREEMENT CONCLUDED British Airways and the trustees of the New Airways Pension Scheme have (NAPS)formally agreed the funding plan including benefit changes to tackle the £2.1billion deficit in the scheme. The plan, which was agreed in principle with the trustees last year, includesannual company contributions of some £280 million for the next ten years and aone-off cash injection of £800 million. It also includes benefit changes totake effect from April 1 and an additional £150 million in cash over the nextthree years, subject to the airline's financial performance. The benefit changes will deliver an immediate deficit reduction of some £400million and a saving of some £80 million a year. British Airways' chief financial officer Keith Williams, said: "This brings to aclose our lengthy consultation process on pensions. It provides greaterstability and certainty for all 70,000 NAPS members and frees the company tomove forward into an exciting phase of investment and growth." ends February 7, 2007 024/KG/07 Notes to editors: Benefit changes include • Normal retirement age at 60 with an accrual rate of 1/60 and contribution rates of 8.5 per cent. • Normal retirement age at 65 with an accrual rate of 1/60 and contribution rates of 5.25 per cent. • Normal retirement age of 55 with an accrual rate of 1/60 and contribution rates of 17.5 per cent. • Options to buy improved accrual rates. • Lifting the cap on total pension contributions from 15 to 30 per cent • Introducing tax efficient ways of making pension contributions. • Future pensionable pay rises capped to inflation • Pension growth in retirement (LPI) remains at five per cent. Staff can still choose to retire earlier than the normal retirement age but witha reduced pension. Certain information included in these statements is forward-looking and involvesrisks and uncertainties that could cause actual results to differ materiallyfrom those expressed or implied by the forward looking statements. Forward-looking statements include, without limitation, projections relating toresults of operations and financial conditions and the company's plans andobjectives for future operations, including, without limitation, discussions ofthe company's Business Plan programmes, expected future revenues, financingplans and expected expenditures and divestments. All forward-looking statementsin this report are based upon information known to the company on the date ofthis report. The company undertakes no obligation to publicly update or reviseany forward-looking statement, whether as a result of new information, futureevents or otherwise. It is not reasonably possible to itemise all of the many factors and specificevents that could cause the company's forward looking statements to be incorrector that could otherwise have a material adverse effect on the future operationsor results of an airline operating in the global economy. Information on somefactors which could result in material difference to the results is available inthe company's SEC filings, including, without limitation the company's Report onForm 20-F for the year ended March 2006. This information is provided by RNS The company news service from the London Stock ExchangeRelated Shares:
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