British Airways has launched legal action against the trustees of the Airways Pension Scheme (APS), the oldest of BA’s three pension schemes.
The airline is asking the courts to declare invalid a recent decision by the pension scheme trustees to increase members’ benefits above the level required by the scheme rules. APS has about 29,000 members, of whom 90 per cent are pensioners. Only around 800 are still working for the airline.
British Airways said in a statement that it is concerned to ensure that its company pension schemes should act in the best long-term interests of scheme members.
“The Airways Pension Scheme (APS) had a deficit of £680m at its most recent evaluation. This means that the existing benefits of APS members are some way off being fully funded, even before the trustees’ decision to increase those benefits above the level promised under the scheme rules.”
The company said it was concerned the additional increase might set a precedent for further increases in the future. “If allowed to stand, this decision can only add to the scheme’s liabilities and make resolution of the deficit more difficult. We regret that the trustees have not heeded concerns expressed by both ourselves and the Pensions Regulator,” the airline went on.