BBC Ends Final Salary Plan for New Staff

The BBC announced on Tuesday that it is closing its final salary pension scheme to its new employees and a slowing of the rate at which current workers earn new benefits, which appears in the first overhaul of a retirement in the public sector.
According to chief financial officer at the BBC–Zarin Patel, it is indicated that the decision was made after the trustee and the company saw the size of the gap to grow by 2 billion EUR from April 2009 from £475 million a year earlier. Although equity markets have recovered in the following year, they do not have enough one to do the costs of rising life expectancy and the impact of calculating the debt with a much lower bond yields.
From 1 December 2010, new employees at the BBC will no longer be able to be used for defined benefit pension plans. Instead, there might be a defined contribution scheme, which offered to pay the ultimate benefit depends on the size of contributions and investment income.
In addition, the existing staff, the definition of “final salary” change of 1 to see April 2011. From that point on, the salaries rise, but only rise 1% point is that count against the definition of final salary, on which the pension. It will mean that younger employees with long service with the BBC, are probably much less generous pensions than older workers with similar careers retirement.
The BBC had already taken measures to retirement costs in the run. There are some limited options for early retirement by less generous terms, and the contributions of workers increased to 6.75% from 6% of pay.
The system increases the annual pension payments in line with inflation, although some members of their potential annual increases seen by the limited caps either 5 or 10%.
However the movements far less strict than, say, occurring in the private sector, where the employers close schemes to existing employees, increasing the retirement age and a slowing of the rate are accrued to the new services.