BT’s move to cut workers’ pensions has implications for millions

BT is responsible for keeping Britain’s largest pension fund afloat

Thousands of pensioners face the prospect of sharply reduced retirement incomes as major British companies attempt to alter the terms of ruinously expensive pension pledges.

Telecoms giant BT has written to current and former workers informing them it is going to court to determine whether it can reduce the annual increases applying to pensions paid to its employees.

BT is far from the only business seeking to argue that previous promises made to staff are today unaffordable, and that they should be allowed to “water down” some of the benefits.

On Wednesday, data showed that as many as three million workers with “final salary” type pensions had a 50:50 chance of losing a fifth of their promised income – because companies could not afford to pay.

The figures, from the Pensions and Lifetime Savings Association, are the latest in a series of reports highlighting a crisis in company pensions.

In the case of BT, the proposed move would mean many of the 80,000 current and former staff needing to find other sources of income to bridge the gap.

Continue reading (The Telegraph) →

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