deficit comes as no surprise to me,some BA captains have pension pots of around 1.8 million....yes million.just do the sums,number of pilots,pension pots and you can see where the pension deficit lies.

British Airways Pensions
 

Does anyone know............Assuming the worst case that BA is made insolvent and re-formed as a different company, will existing BA pensions - both groups - be protected ?

lpatrick
 

...that's not what it says on the link you provided viz.

'In 1993 Norman Lamont reduced the value of tax credit on share dividend payments for pension schemes to 25% which later provided Gordon Brown with the idea of abolishing it altogether.'

I was happy with the 25% mate (cf the 0% the class warrior imposed so he could support 'his people').

'Best if we keep politics out of the forum surely ? '

So why do it ?

I don't know what reserves the pension scheme protection thingy has, but I hope it doesn't have to bail out these BA deficits otherwise the levy will hit us all.

Let's not forget in all of this, that even the BA NAPS scheme is still about 80% funded, and it is the deficit we are talking about, which is a notional long term issue.

The valuation process is designed to identify a way forward.

The pension deficit does not impact directly on the ability of BA to trade, but the size if the funding required to satisfy the regulator and the ability of BA to pay will determine the split between the money BA pay to service accrued benefits and future benefits. This will drive the changes necessary to future benefits. It is not necessarily cheaper to discontinue the scheme.

That's as I understand it, anyway ....

despite my previous post being deleted....i state once again,i over heard 2 ba pilots discussing their pensions,both of which exceeded 1.8 million pounds,yes pounds in their pension pots.from those figures i can deduce where the pension deficit lies....the huge pension liabilities owing to the pilots,its dead simple.

Perhaps it was deleted because you clearly understand nothing about pension funds if you believe that is the problem.

Its obvious some of you don't understand Pensions.

A pensions pot of £1.8M, assuming it was a Final salary related pension scheme simply identifies the level of funds required to meet the liability that has built up in respect of the member of the scheme. These type of schemes bear the investment risk, not the individual, as in money purchase arrangements.

The shortfall in solvency of the scheme relates to the inability of the Employer/Trustees to have met the funding requirements of ensuring 100% solvency of the scheme - due to either the failure of investment growth, insufficient employer funding and/or the fact folks are living longer !

Probably a combination of all three (and a lot of other factors) !

It is unfair and disengenious to slur the pilots involved - they are members of a scheme originally designed to meet the promises made to them of a healthy retirement - a commitment made to them as part of their contract - it's just very expensive !

This is so much more important:
http://pict.com/expo/3660311/5742adb005

MM,
High praise and if that's what the pilots' trustee says then I too am sorry to see him go.

Pension figures
 

Can't see the £1.8M accrual being right. Notional calculations of funding levels typically work at 5% (nice work if you can get it). £1.8M implies an annual pension of £90k, which at two thirds of earnings means current salary of about £130k. If these numbers are in fact right it explains a lot of BA's problems, pension and otherwise.

Agreed, in many cases the correct figure is likely to be higher, in some cases considerably so!

And your point is?

Current basic top rate for a 24yr BA B777 Captain is £144,448 pa.

Instructors and checkers earn more, as do management pilots, and their CITV's will be correspondingly higher.

And your point is?

Please see previous posts from ScotsAndy, Rainboe and M Mouse for some enlightenment on the topic.

my point is
 

....to get an answer confirming the calculations, so thanks.

""Current basic top rate for a 24yr BA B777 Captain is £144,448 pa""

24 yr Captain may have been working for BA for about 35 Years. So, that would work out an average of about £4200 a month. Now, if a pilot was frugal, that £1.8m may just be correct.

The problem is world wide, not just with BA. Everybody is feeling the "penny pinch" and cutting cloths as appropriate. Somebody will have to pay, but as usual, its the staff on the lower wages and worst contracts who will feel the full force.

Oh, somebody mentioned MP's pensions: go compare.com
 

Currently, MPs with 20 years' service can retire on a pension of £30,000 a year. The average private sector pension is about £25,000.

I told you this was more important[URL="http://pict.com/expo/3660311/5742adb005"]

no need for prayers
 

Hiya, go easy, I was just applying the standard terms (two thirds of salary for 40 years service) generally applying to industry. I actually thought the numbers were too high so was expecting praise for a correction. Unfortunately got it wrong so had to duck smartly. Oh well, live and learn. Defined benefits schemes now seem so optimistic in those long ago promises made. To think the UK was self-satisfied at having better pensions than Europe just a decade or so ago but that was before GB saved the world.

A report in the Telegraph
Pilots at British Airways move millions out of company pension - Telegraph

Rainboe,

Meyhinks you are so wrong. Do have a look around at exactly what is happening to other airlines and their p-schemes. You can forget existing protections ring fences, guarantees and actuarial assurances. The mathematics are clear and damage limitation will be the order in future, for the sake of the business and the existing employees. Expect a dismantling of the existing schemes, a money pot in own name and go to market is the only clear way out for BA.
King was the fella when I was at Hamble, Ayling came in with a remit to break the unions. The independants all waited to see the inevitable. Perhaps the self destruct button has just been pressed.
Koi of 744

Koi,

save your breath, Rainboe will be the last to realise......