Workers are worried their pensions will be cut

BAE Systems faces a serious shortfall in its final salary pension scheme, and has asked employees to raise their level of contribution.

But the Transport and General Workers Union (TGWU) has rejected the company's plan and has threatened strike action to protect employees' pension rights.

The TGWU has gone on the offensive, claiming that BAE faces a pension crisis of its own making and asking for a series of guarantees from the company.

Contribution rises

BAE is in the process of conducting a full pensions review and has drafted a series of proposals to plug an estimated �2.3bn black hole in the company final salary scheme.

We want a firm guarantee that the first call on any future pension surplus goes to the workers Jack Dromey, national organiser, TGWU

In return for keeping final salary benefits for existing scheme members employees will have face rises in contribution levels.

The move would affect seven pension schemes and 57,000 workers at 63 UK sites.

However, the TGWU has claimed that on average employees face having to pay up to �20 a week more into their pension.

Demands

The TGWU is furious that its members are being asked to up contributions to plug a black hole which can be partly blamed on the company having taken a series of contribution holidays during the 1990s when stock market performance was strong.

As a result, the TGWU has threatened strike action and issued a series of demands prior to today's crunch meeting with BAE.

"BAE must bear the brunt of the burden of plugging the �2.3bn hole.

"We want a firm guarantee that the first call on any future pension surplus goes to the workers," Jack Dromey, TGWU national organiser, said.