Centrica urged to talk about pension proposals

UNISON members won’t accept company’s proposals to work longer, pay more and get less

a lit gas ring

UNISON has rejected pension proposals from Centrica (British Gas) which would require members to work longer, pay more and get less.

The rejection comes in the union’s formal response to the company’s statutory consultation on its proposals, which would affect around 2,000 UNISON members working for British Gas as well as other workers across the business.

The proposals include:

  • linking retirement to individual workers’ state pension age, which would be 67 for many;
  • a 3% increase in members’ contributions – following a 3% increase three years ago – while a ‘low-cost option’ would see a further 1.5% increase;
  • reducing the default accrual rate for members’ benefits from 1/60th of pensionable salary for each year paying into the scheme to 1/80th.

UNISON national officer Matthew Lay said: “The proposals add up to an unacceptable deal for British Gas staff and penalises the poorest paid in the business which is plain wrong.

“Staff are being asked to work longer, pay more, get less. It doesn’t give staff much hope for the future.”

He pointed out that with the second big increase in members’ contributions in three years, workers would be paying 12% for a 1/80th benefit. The low cost option would see members paying 7.5% for 133rd of pensionable salary for each year – which he described as “really poor”.

While the company is offering compensation, this is 50% lower for low-paid staff members. UNISON is suggesting a common percentage of salary for all staff.

However, the union is keen to stress that it is keen to talk to the company, saying that limited information has been provided about a business case for change, and urging Centrica to get round the table to discuss possible alternatives.

“For the avoidance of any doubt,” said Mr Lay, “we welcome the continued commitment to look to provide a form of defined benefit pension scheme for our members.

“But the fact remains this needs to provide a good quality pension benefit at an affordable cost. These proposals put simply, do not do that.”


Download UNISON’s response to the Centrica consultation