BAE Systems to reduce UK pensions shortfall

Defence giant BAE Systems is close to making a deal with trade unions to reduce UK pension liabilities by £1.7bn.

The company’s chairman, Dick Olver, told BAE’s annual meeting that the £2.8bn shortfall would be reduced by £1.7bn under plans which would see both employees and the company increasing their contributions to the fund.

When the deal is finalised, employees will double their contributions from 4.5% to 9%, while company will raise its contributions from 12.5% to 18%.

The scheme is designed to make the savings over a 15-year period.

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