Thursday 11 November 2010

NUJ anger as Newsquest pension scheme closes

The NUJ has accused Newsquest management of "arrogant ignorance" after the company confirmed plans to shut the group's final salary pension scheme to new accrual.

The group's chief executive Paul Davidson gave notice in letters to members that the scheme would end future pension growth on March 31, 2011. According to the union, he said he wanted to thank members "for your support of the company and your understanding that we had to make a difficult decision".

The NUJ had argued that the scheme could be kept open as a key benefit to prevent future poverty for Newsquest staff in their retirement. It claimed that detailed actuarial advice obtained by the union showed that the calculations underpinning the valuation of the Newsquest fund led to unnecessary volatility which in turn put pressure on the company to act.

A new draft valuation of the fund drawn up for the company was said to show an overall deficit of £123 million. The NUJ claims requests to the company and trustees to make the information available were refused ahead of its official publication next year - after the scheme has closed.

The union points out that Newsquest's decision comes as new official figures showed that UK defined benefit pension schemes bounced back into the black in October with a collective surplus of £13.5 billion.

Newsquest shut the final salary pension scheme to new staff a number of years ago and set up a cheaper defined contribution scheme for them to pay into but, according to the NUJ, it attracts among the lowest company contributions in the newspaper industry. Those losing the more secure final salary scheme are being offered this as an alternative.

The NUJ has called on the company to consult with the recognised trade unions about providing better, affordable retirement benefits for all Newsquest staff.

Chris Morley, NUJ Northern & Midlands Organiser, said: "From the answers we obtained to detailed and challenging questions put to the company in the consultation over closure of scheme, it was patently obvious that bosses were hell-bent on swinging the axe.

"I believe the decision has been taken as a result of arrogant ignorance. We firmly believe that given the will, a way could have been found to retain the best elements of a defined benefit pension scheme, not just for those currently in it, but all those who have been excluded from it over the last few years.

"Now that Paul Davidson has made the board's position clear, the focus clearly falls on the inferior benefit left in its place. This is a profitable company that can afford to do much better and the NUJ will be pushing it all the way on this."

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