BA Pension Deficit
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Joined: May 2002
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From: uk
BA Pension Deficit
According to The Financial Times today,
'BA staff could expect little more than 60% of their promised pension benefits if the company were to become insolvent.'
In my view something that is entirely possible - terrorist attack perhaps on a BA aircraft, more financial angst and then of course some further union posturing affecting passengers to finally kill off a company whose loans are officially graded, at the moment, as 'junk bonds' by the city.
Sadly, part of my pension is tied to BA. When BA bought DAN for £1 in Nov 91, the Dan Air pilot's pension scheme was wound up. A 'surplus' of about £8 million pounds was taken by BA.
'BA staff could expect little more than 60% of their promised pension benefits if the company were to become insolvent.'
In my view something that is entirely possible - terrorist attack perhaps on a BA aircraft, more financial angst and then of course some further union posturing affecting passengers to finally kill off a company whose loans are officially graded, at the moment, as 'junk bonds' by the city.
Sadly, part of my pension is tied to BA. When BA bought DAN for £1 in Nov 91, the Dan Air pilot's pension scheme was wound up. A 'surplus' of about £8 million pounds was taken by BA.
Last edited by fiftyfour; 10th December 2003 at 04:08.
Joined: Jul 2003
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From: Surrey
I'm not sure what your point is fiftyfour .
You are possibly correct though, any terrorist action etc. could have that effect. So BA goes out of business and you would lose part of your pension.
And of course approximately 50,000 people would lose their jobs and income.
You are possibly correct though, any terrorist action etc. could have that effect. So BA goes out of business and you would lose part of your pension.
And of course approximately 50,000 people would lose their jobs and income.
Thread Starter
Joined: May 2002
Posts: 156
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From: uk
four two.
There has been a lot of mismanagement at BA. They have plundered the UK aviation scene since privatisation. The money has been squandered in maintaining their fortress and protecting their uneconomic work practices. Unfortunately they have allowed this sloppy way of managing the business to affect the way the pension fund is run as well. Most other big companies take their responsibilities to their staff (with reference to deferred pay)more seriously. Boots pension scheme for example is fully funded at the moment. Considering the hurdles imposed by government, like the fact that pension funds are not allowed to be more than 5% overfunded, and the general financial market problems of the last few years, Boots get top marks from me. BA is in the 'could do much better' category.
There has been a lot of mismanagement at BA. They have plundered the UK aviation scene since privatisation. The money has been squandered in maintaining their fortress and protecting their uneconomic work practices. Unfortunately they have allowed this sloppy way of managing the business to affect the way the pension fund is run as well. Most other big companies take their responsibilities to their staff (with reference to deferred pay)more seriously. Boots pension scheme for example is fully funded at the moment. Considering the hurdles imposed by government, like the fact that pension funds are not allowed to be more than 5% overfunded, and the general financial market problems of the last few years, Boots get top marks from me. BA is in the 'could do much better' category.
Joined: Jun 2001
Posts: 4,777
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From: Blighty
And don't forget Gordon Brown's raid on pension funds a few years ago. I fit had been a corparate raid instead of having the somewhat dubious legality of being part of a budget, someone would be doing time!
Joined: Jul 2003
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From: Surrey
fiftyfour,
You won’t get any argument from me about mismanagement. They have in my opinion bolstered their profits from time to time by selling off parts of their business. Properties, maintenance facilities ( u/c shop, engine workshops etc. If you go back to the days prior to privatisation, they paid off loans early that that needn’t have been paid, which made their finances look bad. This means that when they were privatised they showed an immediate profit.( I'm not going to mention the tail plane painting fiasco either
)
To get back to the pension scheme which was the original point, there have been many factors which have caused the schemes (both APS and NAPS ) to be in the parlous condition they are in. Not all problems can be laid at BA’s door. As already stated, Gordon Brown / and financial markets are contributory factors.
As we know BA tried to treat themselves to what was surplus funds from APS (as they saw it!) 2/3 years ago, after having a pension holiday for approximately 14 years. Fortunately they were beaten in the courts. If they had succeeded APS would be in an even worse state today. As it stands now though BA have been forced to contribute £26M per annum back into APS. NAPS problems are still being negotiated I believe.
At least you are fortunate it only forms part of your pension, others will have to rely entirely on their BA pension.
(if some of this post is a bit incoherent, I lost part of it transferring it from Word )
You won’t get any argument from me about mismanagement. They have in my opinion bolstered their profits from time to time by selling off parts of their business. Properties, maintenance facilities ( u/c shop, engine workshops etc. If you go back to the days prior to privatisation, they paid off loans early that that needn’t have been paid, which made their finances look bad. This means that when they were privatised they showed an immediate profit.( I'm not going to mention the tail plane painting fiasco either
)To get back to the pension scheme which was the original point, there have been many factors which have caused the schemes (both APS and NAPS ) to be in the parlous condition they are in. Not all problems can be laid at BA’s door. As already stated, Gordon Brown / and financial markets are contributory factors.
As we know BA tried to treat themselves to what was surplus funds from APS (as they saw it!) 2/3 years ago, after having a pension holiday for approximately 14 years. Fortunately they were beaten in the courts. If they had succeeded APS would be in an even worse state today. As it stands now though BA have been forced to contribute £26M per annum back into APS. NAPS problems are still being negotiated I believe.
At least you are fortunate it only forms part of your pension, others will have to rely entirely on their BA pension.
(if some of this post is a bit incoherent, I lost part of it transferring it from Word
)
Joined: Sep 2002
Posts: 2,079
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From: Middlesesx
Well said four-two. BA for all its faults seems to me to be no different from many other large corporations within the UK. Most of which all have problems with commitments to their pension funds and lashings of examples of mismanagement, surely a skill that UK plc has perfected.
I do not agree with some prior comments either, DAN, BCAL to name but a few were bust when BA had the misfortune to save some of them and in both cases inherited businesses that were worth nothing and were riddled with inefficiency and union problems, examples of which BA had enoughof its own to cope with.
We at BA are only to aware of the state of avaition. I am of a view that in the long term there is not a great deal of money in it as many have found to their cost ditto the airport operaters and owners.
I do not agree with some prior comments either, DAN, BCAL to name but a few were bust when BA had the misfortune to save some of them and in both cases inherited businesses that were worth nothing and were riddled with inefficiency and union problems, examples of which BA had enoughof its own to cope with.
We at BA are only to aware of the state of avaition. I am of a view that in the long term there is not a great deal of money in it as many have found to their cost ditto the airport operaters and owners.
Last edited by HZ123; 12th December 2003 at 22:34.
