International Cons Airlines Group British Airways to launch new UK pension scheme (7618Y)
December 08 2017 - 2:01AM
UK Regulatory
TIDMIAG
RNS Number : 7618Y
International Cons Airlines Group
08 December 2017
BRITISH AIRWAYS TO LAUNCH NEW UK PENSION SCHEME AND CLOSE ITS
MAIN DEFINED BENEFIT SCHEME TO FUTURE ACCRUAL
International Airlines Group's subsidiary British Airways has
decided, following consultation with its trade unions and
employees, to launch a flexible benefits scheme incorporating a new
defined contribution pension scheme.
The scheme will open on April 1, 2018 replacing the main UK
defined benefit scheme, the New Airways Pension Scheme (NAPS), and
the main UK defined contribution scheme, the British Airways
Retirement Plan (BARP).
The changes are subject to NAPS trustees agreeing to amend the
scheme's rules to enable closure to future accrual.
The new scheme will offer market-competitive arrangements with a
choice of contribution rates and the ability to opt for cash
instead of a pension. Active NAPS members will also be offered a
choice of transition arrangements including a cash lump sum,
additional company pension contributions or additional pension
benefits in NAPS prior to its closure.
The overall financial impact on British Airways will depend, in
part, on the transition arrangements members select.
Ends
December 8, 2017 IAG15
NOTES TO EDITORS
NAPS opened on April 01, 1984 and closed to new joiners on March
31, 2003. It represents around 47 per cent of BA's active employees
currently with 52 per cent in BARP.
These changes are aimed at addressing the rising cost of future
pension provision and the volatility in the NAPS scheme which had a
deficit of GBP2.8 billion at its last valuation, as at March
2015.
The next valuation will be as at March 31, 2018, but will now
reflect the closure of the scheme to future accrual.
The NAPS pension liabilities will be reduced by the closure of
the scheme to future accrual. The valuation of pension liabilities
currently assumes growth in the pensionable salaries of active
members up until retirement age. Following closure, members'
deferred pensions will be increased annually by inflation (measured
by CPI), which is generally lower. The value of the reduction will
only be known once members have selected their transition options,
as some of the options allow members to select additional pension
benefits in NAPS prior to its closure, which will partly offset the
reduction.
LEI: 959800TZHQRUSH1ESL13
This announcement contains inside information and is disclosed
in accordance with the company's obligations under the Market Abuse
Regulation (EU) No 596/2014.
Forward-looking statements:
Certain statements included in this report are forward-looking
and involve risks and uncertainties that could cause actual results
to differ materially from those expressed or implied by such
forward-looking statements.
Forward-looking statements can typically be identified by the
use of forward-looking terminology, such as "expects", "may",
"will", "could", "should", "intends", "plans", "predicts",
"envisages" or "anticipates" and include, without limitation, any
projections relating to results of operations and financial
conditions of International Consolidated Airlines Group S.A. and
its subsidiary undertakings from time to time (the 'Group'), as
well as plans and objectives for future operations, expected future
revenues, financing plans, expected expenditures and divestments
relating to the Group and discussions of the Group's Business plan.
All forward-looking statements in this report are based upon
information known to the Group on the date of this report. The
Group undertakes no obligation to publicly update or revise any
forward-looking statement, whether as a result of new information,
future events or otherwise.
It is not reasonably possible to itemise all of the many factors
and specific events that could cause the forward-looking statements
in this report to be incorrect or that could otherwise have a
material adverse effect on the future operations or results of an
airline operating in the global economy. Further information on the
primary risks of the business and the risk management process of
the Group is given in the Annual Report and Accounts 2016; these
documents are available on www.iagshares.com.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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