CONSULTATION ON BBC PENSIONS

UNIONS are canvassing members' views on ‘unacceptable’ changes in BBC pensions.
At a meeting, representatives of BECTU and NUJ were told that a cut in pension entitlement for staff retiring early, or being made redundant over the age of 40, was necessary to ensure the long-term survival of the pension scheme.
The BBC announced earlier this month that a discretionary formula under which many staff had left the Corporation with pensions enhanced by up to 20 per cent was to be scrapped in March 2002.
Negotiators told the BBC that the change was unacceptable, and would be resisted if possible.
According to managers at the meeting, the savings achieved by abolishing the enhancement would ensure that the BBC's pension fund will remain in surplus, with more value than they need to meet their obligations, for the next eight or nine years.
Union representatives pointed out that this would simply delay the moment when the Corporation, currently paying 4.5 per cent of their wage bill into the pension fund, would have to increase their contributions to a level of 15 per cent or more once the surplus had gone.
Managers acknowledged that without the surplus being used to pay pensions to thousands of retired staff, the BBC would have to step up their payments from approximately £25m per year, to as much as £100m. However, they emphasised that even after the cost-saving reduction in benefits, the BBC scheme would still be one of the best in the UK, giving staff the right to retire from the age of 50 without punitive penalties.
Introduced in the 1990s to soften the blow of redundancy for thousands of staff hit by job cuts, the special formula was, said the BBC, a short-term measure which had always depended on periodic renewal to continue. It was not a guaranteed right
and could be scrapped without changing the deeds or rules of the BBC pension fund.
The unions condemned the proposed change, which had been approved by the BBC's management executive committee rather than the Pension Trustees, on several grounds.
Management explained that staff given enhanced pensions after March 2002 thanks to the ‘transitional’ arrangements would be funded by the BBC themselves, and not from the pension fund. While this would be guaranteed for full BBC employees, no decision had been reached on funding for staff in the Corporation's subsidiary companies - Worldwide, Resources, and Technology.
Unions were told that an announcement about transitional arrangements for staff in subsidiaries was likely to be made next week, once problems with ‘fair trading’ regulations had been resolved.
The BBC were warned that the planned reduction in pension rights had caused major concern among the many staff who belong to the ‘old benefits’ pension scheme - recent employees have been limited to joining the ‘new benefits’ scheme where the special formula has never applied.
Members of both unions are being asked to pass their views on the change to representatives, and further meetings will be scheduled with management once their opinions have been collated. (CD)