Analysis By Ian Pollock BBC News personal finance reporter

BA broke the news in its staff newspaper

How do you get your workforce to save you nearly half a billion pounds?

Simple, soften them up with a long campaign about how a pension fund deficit is threatening the future of the company - and therefore their jobs - then ask them to pay more for their pensions.

That is the plan that British Airways is now bringing to fruition.

The airline is joining a growing number of employers who have been not only shutting their schemes to new joiners (something BA did three years ago) but also changing the future build up of pensions by current members of their schemes.

Already firms like Rentokil, Sainsbury's and Scottish & Newcastle have said they will reduce the value of their future pension provision.

In BA's case its big final salary scheme will stay open to its 34,000 contributing members, for which they are probably very grateful.

"We are keeping a final salary scheme while some other companies have abandoned theirs," chief financial officer Keith Williams said in the latest British Airways News.

"We're also protecting current pensions with the changes only relevant to future service."

But to stop the scheme's deficit ballooning any further, membership is going to cost rather a lot more.

Big cheque

In 2003 the scheme's actuaries said it was short of �928m, so a recovery plan was put in place.

It means working longer to get a similar amount of pension, but one that is more secure Willie Walsh, BA chief executive Can you stop your pension fund being changed?

Under the plan BA will have soon paid in �350m. If BA can get the new arrangements in place by this time next year, it has also promised to top-up the fund with a one-off �500m payment.

So, what is it worried about if it can afford to eradicate most of the deficit so easily?

The fund's actuaries will soon start on the next three yearly scheme valuation, and as a company spokesman acknowledged "it is common sense to assume the deficit will have grown even more".

BA needs to make sure that the future cost of the scheme is reduced, so any new deficit is smaller or prevented altogether.

"These changes are necessary to clear the past deficit and to contain the amount of future funding needed," BA's chief executive Willie Walsh said.

"It means working longer to get a similar amount of pension, but one that is more secure."

Retire later

The big headline change at BA is that the normal retirement age will rise to 65.

Hand in hand with this will be what is known in pensions jargon as a slower "accrual rate" - for each year of service, the staff will build up slightly less pension than before.

BA staff could soon have to work longer for less

As a result, the pension age of ground staff will rise from the current levels of either 60 or 63 while cabin staff will have to work an extra 10 years beyond the current retirement age of 55 to get the sort of pension they had been expecting.

This is being phased in, with a retirement age of 60 operating for the first five years before the 65 year target kicks in.

Pilots will also have to work longer - they will now have to fly until the age of 60 rather than 55.

If countries like France and the USA can be persuaded to lift their ban on pilots flying over their territory beyond that age, then BA plans to raise their retirement age to 65 as well.

So work longer - and pay in more as a result - to get the same pension.

Other changes

These aren't the only changes.

In line with new limits allowed by current legislation, the inflation proofing of pensions in payment will be restricted to just 2.5% a year.

That means if prices shoot up at any time in the future, the real value of pensions for retiring staff will be severely reduced.

Meanwhile, the top slice of any above-inflation pay rise will not be used to calculate future pensions.

The union is .... concerned that there is little room for individuals to make a choice on when they retire on a full pension Balpa

As a result, current staff will find that their pensionable salary - already set at just 85% of gross salary - will be even lower than their actual pay.

Thus pensions may become increasingly disconnected to final salaries.

These changes will not affect pensions currently being paid to around 15,000 retired staff.

The new package will also not affect pension already built up.

Therefore, if someone has been working at BA for 20 years and stays for another 20 their pension will eventually have two streams of income - some built up before 2007 under the current rules, and the rest built up afterwards under the new rules.

What next?

Under new laws BA, like all employers, is now obliged to consult with its workforce for at least two months over the proposed changes.

Consultation does not mean agreement. But it is not supposed to be a sham either.

The company says it will talk to trade unions and, crucially, to the scheme's trustees - they hold the power to approve or reject the changes.

BA has been trying to sell the changes to its staff

There will be staff briefing sessions, questions and answers on BA's internal internet site, worked examples of how things might change for typical staff members and an opinion poll by MORI.

Staff will also be able to write to BA executives with their views.

The company will not be drawn on what it will do if its plans are rejected.

Earlier this year the pilots union Balpa threatened to organise the first strike of its BA members if the current pension scheme was mutated into a less generous "career average salary" version.

That sabre rattling appears to have had some effect.

But Balpa said it would examine the new proposals closely.

"The union is .... concerned that there is little room for individuals to make a choice on when they retire on a full pension" said general secretary Jim McAuslan.

"The company may also be misleading its staff in the way it is communicating the changes to the scheme."