This is taken from The Observer:

Axe hovers over BBC's final salary pensions

Union threatens 'immediate' strike if scheme closes and retirement age is raised for workers under 50
James Robinson and Richard Wachman
Sunday April 9, 2006

The BBC may close its final salary pension scheme to new members and raise the retirement age for younger employees from 60 to 65.

Unions warned last night that the plan could prompt a wave of strikes. 'If it is as drastic as we think, we will strike immediately,' said Gerry Morrissey, assistant secretary general of Bectu, the largest broadcasting union.

The corporation currently runs a generous final salary scheme, which guarantees employees a retirement income based on length of service and level of pay in the last year of work. But it will be replaced by a 'career average' scheme, according to Bectu officials who claim to be familiar with the plan.

A similar scheme was recently introduced by the Co-op. It would leave new members around 30 per cent worse off, according to Bectu.

'Our members will be outraged,' said Morrissey. 'Apart from being paid every month, pensions are their biggest concern.'

He added that employees over the age of 50 may be asked to increase pension contributions. The BBC has asked all its pension scheme members to increase payments slightly in recent years and has also raised its own contribution.

Union officials are meeting BBC executives on 20 April to discuss the plan, but the fact they are already threatening to strike is bad news for director-general Mark Thompson. He has already announced plans to save £320m a year by axing nearly 3,000 people from the corporation's 28,000 workforce. He was forced to modify those plans following industrial action last year.

The BBC has always regarded its pension scheme as a vital way to attract and keep staff who could earn more in the private sector. In its last annual report, it repeated its commitment to the existing scheme. But, like many funds, its assets may not be enough to cover the cost of paying for an ageing workforce to retire.

With nearly 20,000 staff contributing £100m a year, the scheme is one of the biggest in the country. It has a projected deficit of £422m, according to the BBC's latest annual report, although that funding gap has been narrowed in recent years. Actuaries are carrying out a routine review of the scheme.

Bectu expects the BBC to make an announcement by the end of May, once the plan has been approved by the pension fund's trustees, who include BBC director of strategy Caroline Thomson.

A BBC spokesman said: 'The BBC scheme is a very healthy one. This is a routine actuarial review. When it is finalised we will communicate with our members and brief the unions.'