The Atomic Weapons Establishment – the company that makes the UK’s nuclear deterrent – has today (Tuesday) announced its intention to consult on closing its defined benefit pension scheme to all staff and worsen the defined contribution alternative that it offers.
Prospect reacted with dismay at the announcement of a 60-day statutory consultation on drastic pension changes to run from 27 May to 25 July.
The company is proposing to close its defined benefit pension scheme to all members on 30 September 2016. It also plans to cut the contributions it makes to the defined contribution pension scheme that will become the only pension scheme offered to staff in the future.
Richard Tabbner, Prospect negotiator, said: “Staff working at AWE will be shocked by these proposals. This goes against a number of guarantees made at the time the company was first privatised.
“Prospect members are well aware of the challenges involved in funding good quality pension provision and over the years they have agreed to cap the cost of the scheme to their employer.
“Employees’ contribution rates have increased from 1.5% of pay to 10% while benefits have been reduced and the link between pension and final salary removed.
“Although members were aware that the position was under review and that the company was considering closing the defined benefit scheme, the additional step of cutting the contribution rate to the defined contribution pension scheme will be considered a provocation.
“Prospect is organising members’ meetings to get their initial views on what an appropriate response would be. We will make vigorous representations on behalf of members as part of the consultation process.
“We also want to clarify the role and position of ministers and officials at the Ministry of Defence given the sensitivity of the work undertaken by this company and the potential impact this announcement could have on the company’s ability to deliver.”