British Airways and pension fund trustees agree on plan to close funding deficit

The Associated Press ~ staff The News
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LONDON — British Airways says it has reached an agreement with pension trustees on a plan to cut the airline’s pension deficits.

The deal, if approved by regulators, is designed to resolve a key issue in a proposed merger with Spanish airline Iberia.

BA said Tuesday its annual contributions to the two pension plans would continue at 330 million pounds ($487 million) per year, plus increases of about 3 per cent a year.

BA says it will make addition contributions if its year-end cash balance is over 1.8 billion pounds, and it has made additional provisions for securing pensions if it becomes insolvent.

The issue was a sticking point in negotiations with Iberia, which can still reject the merger.

BA is losing money, and is locked in a protracted dispute with the cabin crew union over other issues including working practices and travel benefits.

Organizations: British Airways

Geographic location: LONDON

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