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BBC pension plan causes strike threats

In June the BBC announced plans to reform its pension plan in an attempt to tackle the pension deficit estimated at £2bn.

The original proposes announced were to impose a cap on pensionable salaries to a 1% increase each year or to leave the final salary arrangement and join a new money purchase arrangement which is offered to new employees.

The new proposal which was sent to the BBC staff on Monday offers an extra option to that above, a pension based on a career average salary.

The new pension benefit would use the average pay of employees and no new cap would be imposed, however to afford the cost of such an arrangement, an increase in contributions is required of 7% instead of the current 4%.

The annual pension would be calculated using 1.67% of the average salary per year and would increase in line with the Consumer Prices Index (CPI) or 2.5%, whichever was lower.

On 13 September 2010 the BBC's main unions announced strike dates of 5, 6, 19 and 20 October 2010 as a result of the pension dispute.

The BBC has said.

"We are disappointed that the unions have announced dates for industrial action."

"We believe our pension proposals address concerns raised by staff and that they should now have the opportunity to fully consider and explore them within the context of an ongoing consultation rather than the threat of a strike."

To find our further information on Career Average Plans click here