‘Over the past few days the joint unions have held a number of packed meetings as part of our campaign to oppose the BBC’s pensions robbery’, said the NUJ last weekend.
Explaining what the BBC is proposing, it added: ‘From April 1st 2011 increases in pensionable pay will be capped at 1%.
‘So even if you get a pay rise of 3% only a third of this (1%) will apply to your pensionable pay.
‘This deliberately shatters the link between final salary and pensions and means there is no longer a final salary pension scheme at the BBC.
‘The 1% cap will apply to those employed by the BBC, BBC Studios and Post, or BBC Worldwide, and who are in one of the three sections of the Final Salary Pension Scheme, these are Old Benefits, New Benefits and Career Average Benefits.
‘The 1% cap will erode the value of pension already earned.
‘For example 20 years of service on a salary of £30,000 means that by 2011 a member would have earned a pension of £10,000.
‘From that date on if they stay in the scheme the value of the earned pension can only increase at 1% per year regardless of inflation, so in a very few years the earned pension will be worth much less in relation to your salary.
‘The BBC is using sleight of hand to devalue the pension members have already earned.
‘Other examples on Gateway show the impact this will have on a range of staff of different ages, at different pay grades and on different schemes.
‘In essence it means people will lose thousands of pounds every year from their pension – amounting in some cases to hundreds of thousands of pounds over their retirement years.
‘The effect of the cap with standard pay rises is serious, but with promotions it is catastrophic.
‘Whatever promotion you get the level of your pensionable pay cannot increase by more than 1% per year.
‘This makes the pension more like a starting salary pension than a final salary pension scheme.’
Pledging to fight the pensions proposals, the NUJ said: ‘Yes we are holding a series of meetings with our sister unions, Bectu and Unite, across the country seeking the views of our members.
‘We are asking members to support the joint unions demand that the value of any past pension should be fully protected and not devalued.
‘If this guarantee were to be given by the BBC then the unions would be willing to enter into negotiations with the BBC on ways of reducing the deficit.’
One of the questions asked in the meeting was would the NUJ consider proposing a maximum cap on pensions?
In answer to this, the union said: ‘There are numerous alternatives that need investigation including putting a maximum on the pension that could be paid to a person upon their retirement.
‘Some BBC executives can expect pensions of over £220,000 a year – yet they are proposing to address the deficit by undermining the value of the pensions of the lowest paid.’
It went on to say that the BBC was not legally obliged to review the pension schemes now.
The NUJ explained: ‘BBC managers were obliged to review the schemes no later than June 2011.
‘However they chose to conduct a review more than 12 months early and at a time when the stock market was at a very low level.
‘We estimate that if the valuation had been done now that the deficit would be at least £300m lower than the figure of £1.97bn being quoted by the BBC.’
The NUJ added: ‘It is the unions’ view that the BBC deliberately used the worst set of stock market figures available in order to make the deficit look bigger than it is.
‘Secondly, looking ahead, it is likely that the BBC will need to recruit several hundred new staff in Salford in 2011.
‘Implementation of their proposals to the proposed timescale, would deny new staff the right to join the Career Average Scheme.
‘In addition, the government has asked former minister, John Hutton, to do a review of public sector pension provision; the early indications are that pensions already earned by public sector workers would be protected against inflation.
‘The BBC will not even guarantee that.
‘Therefore, it is in the BBC’s interests to implement their less favourable proposals prior to the publication of John Hutton’s report.’
The NUJ warned: ‘These proposals will affect younger members of staff who intend having a career at the BBC more than longer term employees.
‘The likelihood is that the younger staff member will be promoted at least once during their employment; according to the BBC’s proposals, salary increases on promotion will not count for pensionable pay where the increases are higher than 1% in that year.
‘Also, even without a promotion, because the younger member of staff has more working years ahead of them, the gap between their pensionable pay and their actual salary will be significantly greater than those colleagues with fewer years left to work.’
The union stressed: ‘Everyone in any of the pension schemes is affected by the proposals.
‘The impact will be different but the loss of value of pensions already earned applies to everyone and the cap on future pensions affects you too.’
On the role of the pension trustees, the NUJ said: ‘There is a widely-held assumption that the pension trustees are in some way responsible and/or have endorsed these proposals.
‘The fact of the matter is that these proposals are being driven by BBC management.
‘The trustees were told about the proposed changes but were not consulted.’
Members had questioned why have the schemes moved from surplus to deficit in just 5 years?
The NUJ said: ‘In the mid-nineties the pension scheme was so far in surplus that it risked being taxed under Inland Revenue rules.
‘The trustees and the BBC agreed to reduce contributions from around 21% to 8%, split equally between employees and BBC.
‘At the BBC’s request the scheme funded pension augmentation for early retirees which rapidly eroded the surplus.
‘In 2004 the pension scheme ceased to fund augmentation since the surplus was almost exhausted at this point.
‘The trustees asked the BBC to increase its contributions but it declined to do this until 2008. (This is the 13 year pensions holiday that people keep referring to which the unions estimate saved the BBC almost £1bn).
‘By 2008 the scheme was in deficit.
‘The deficit has worsened due to a number of factors including the increase in longevity and the overall reduction in the value of the schemes’ assets.’
Announcing the BBC unions’ next move, the NUJ said: ‘We are holding meetings across the country to consult our members on the proposals on pensions and pay.
‘We will be meeting with Bectu and Unite on 19th July to report back. We are due to meet the BBC again on 21 July.
‘The message coming back loud and clear from all the meetings is that unless the value of any pension already earned is fully protected the unions should ballot for industrial action. The ball is now in the BBC’s court.’
