BAE Systems secures agreement on pensions deficit

BAE Systems has reached an agreement with workers to clear the £1.4bn deficit in its main pension scheme.

The UK’s biggest defence manufacturer will inject £800m into the pension fund under the new deal.

Pension scheme members have agreed to take responsibility for 40% of any future increase in liabilities as a result of employees living longer – either by retiring later or taking benefits at a reduced rate.

Union leaders said the deal was a blueprint for the protection of final salary pension schemes at other big UK employers.

After two ballots, by the company and members of the main scheme, a consensus was reached, although it still needs to be approved by pension fund trustees.

Mike Turner, chief executive of BAE, said: “We are pleased with the outcome of these ballots, which represents good progress in the consultative process.”

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