What type of pension scheme does BA have?
BA has two final salary pension schemes, the Airways Pension Scheme, which has a deficit of £1bn, and the New Airways Pension Scheme, which has a £2.7bn shortfall. Both schemes are closed to new members, but existing members can continue to build up benefits in them. Members earn a pension equivalent to one 60th of their final salary for every year they belong to the scheme. Q: Is this the first time BA has taken action to tackle the deficit? A: No, a number of changes were made to the schemes in 2007 in exchange for extra contributions from BA. Under these changes, members could choose a retirement age ranging from 55 to 65, with contributions ranging from 5.25% of their pay to 17.5%, depending on what age they wanted to start drawing their pension from. A cap was imposed on future pay increases that would be used in pension calculations. In exchange, BA agreed to make a one-off cash injection of £800m into the scheme, annual contributions of £131m every year up to 2016 and additional
