Taildragger, the probelm with pensions was created long before WW joined BA.
In part the pensions problem occurred following the legislation dealing with the Robert Maxwell scandal.
This was made worse by the governments policies to raid pensions fund which at a stroke put them into trouble. Money which should have gone into pension funds went to fund the governments policies.
Recent changes in the way pensions funds are valued and the requirement to have pension funds invest in gilt edged securities means that the probelm has got even worse.
I know as I am a fund trustee. Until this year ago our pension scheme was "fully funded" under the post Maxwell legislation. Following the new method using life expectancy the calculation says we are only 72% funded.
As the pension scheme is closed to new employees already there are only a couple of options.
Ask the employer to put £1m in to top up the fund. (As a membership organisation and charity this is not possible without asking the members of the organisation to cough up some money)
Strike a deal with the pension fund members to determine the value of the fund and shut it down. This takes out any future risk of the fund losing value because of either poor stock market performance or even worse a rise in interest rates and therefore a hammering on the gilt edged securities.
The recently introduced accounting rules requires that companies declare on their balance sheets the new pensions liability. For us that means a £1m liability which appeared overnight and is a matter of opinion.
For BA it means £1b. Taking £1b out of BAs profits to stuff the pension fund has two effects. First it takes away money for investments. Secondly it removes money for the shareholder in BA who surprise surprise are mainly pension funds in one way or another. My pension fund is invested in BA amongst others.
All pension funds are in the same boat. As all the companies start declaring their newly enlarged pension deficits, the value of their shares goes down and hey, the deficits on the pension funds gets bigger. Since 1997 pensions have been slaughtered. Personally I dont think it will get any better unless there is a radical change of policy by the government, even better a change of government.
In the scheme of things the BA staff are in a reasonable position compared with others in that they are likely to be able to work those extra years.
I am associated with the construction industry and there are many people who have the same pension issues who just cannot work until 60 let alone 65 having done a very phyiscal job for the last 40 years. Their bodies are literally worn out. But not to worry, they are not as precious as pilots so do not matter as much.
Everybody is in the same position, for most of us, that is employers, pension trustees and employers, the only way forward is a compromise ad the only way to ensure that pension funds are able to cover their liabilities is if the companies behind them are in business to fund them.
If the BA staff were to go on strike, wreak the company and put their pensions at risk, then it would be unfair to expect the rest of us to pick up the tab and bale their pension fund out. There would be no public sympathy at all.
Just be thankful that we are not in the US where the airline goes into Chapter 11, it dumps the pension fund and relieves itself of all the costs. There are a few pilots over there seeing their pensions disappear faster than a rat up a drainpipe.
The choice for the BA staff and all people in these sorts of pension funds is to decide whether they are to add to the problem or be part of solving the problem.
It will be interesting to see what happens, personally I hope that there is no strike, BA becomes a very efficient and profitable business, is able to keep on topping up its pension funds but more importantly remits enough dividends or the company is valued so high so that my pension fund gets its reward for investing in BA.