BBC pension scheme has massive surplus, claims Bectu union

Broadcast union Bectu has accused the BBC of “burying good news” about its pension scheme by dropping key data from its annual report.

The union claims that finance figures showing a “massive surplus” in the BBC’s pension fund have been omitted from the report, which was published today.

Normally, the BBC reports on each year’s pension scheme “interim valuation” – a snapshot measurement of a pension fund’s health in between the three-yearly full valuations required by law.

This year the interim valuation figures have been dropped – a change that the union believes was made to avoid the BBC having to reveal a large fund surplus at a time the corporation is planning cuts in pension benefits for staff.

Union officials estimate that the BBC’s pension scheme has a surplus approaching £500m, based on the £130m surplus figure that was included in the annual report in accordance with accounting rule FRS17. This measurement has always shown a lower valuation of the BBC scheme than the statutory calculations carried out each year by pension actuaries.

In April, the BBC announced that its normal retirement age would rise from 60 to 65 in 2016, and from this September new staff joining the corporation would have access only to a career average pension, rather than a final-salary scheme.

Additionally, staff are being asked to increase their payments into the scheme to 7.5% of salaries in 2007, followed by another possible increase to 9% in 2008.

Zarin Patel, BBC finance director, said the pension scheme showed a surplus of £13m, on assets of £7.8bn, for the financial year just ended, down from £441m at the time of the last formal actuarial valuation in 2002.

But she admitted that FRS17 accounting standards calculations showed a significant improvement on the pension scheme’s year-on-year position, from a £422m deficit to a net surplus of £170m.

“Some changes to the pension arrangements have been proposed in order to protect the benefits of existing members and maintain competitive pensions for new staff in an environment of increasing costs and investment uncertainty,” she said.

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