British Airways Agrees Deal With Pension Fund

British Airways has agreed with trustees of its pension scheme to make fixed deficit contributions of GBP£300 million a year until 2027.

The agreement in principle with the trustees of its New Airways Pension Scheme (NAPS) is based on a three year evaluation which puts the fund’s deficit at GBP£2.8 billion (USD$3.43 billion). That compares with a deficit of GBP£2.7 billion at the last review.

The increased deficit is due to a reduction in the interest rates used to discount liabilities, BA parent company IAG said.

The agreement caps additional contributions by the airline at GBP£150 million per year, IAG added.

Assets in the scheme at March 31, 2015 had increased by GBP£3.7 billion to GBP£13.3 billion compared to March 31, 2012. Liabilities rose by GBP£3.8 billion to GBP£16.1 billion over the same period.