BBC set to scrap directors’ pension top-ups

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Mark Thompson and other members of the BBC’s board of directors are set to relinquish a controversial pension top-up, in a bid to defuse staff anger about planned changes to the corporation’s pension scheme.

Mr Thompson, the director-general, would see his total remuneration fall by 19.5 per cent if the top-ups are ditched this year.

In an all-staff meeting, he said pension contributions should be “as consistent and fair as they can be irrespective of seniority or juniority of the staff member involved”.

The move was revealed as Mr Thompson and Lucy Adams, the director of BBC People, fielded questions about the proposed closure of the BBC’s final salary pension scheme to new entrants and other changes to payments that will leave younger staff with much lower benefits after they retire.

A BBC spokesman said that the tone of the meeting – attended by 150 people but broadcast across the corporation – was “tough but respectful”. The BBC would put forward amendments to its initial proposals on September 1, as part of a consultation process currently slated to close at the end of next month.

These new proposals, which come as BBC staff are balloted on strike action over the plans, could address three proposed changes: the cap on increases in future pensionable salary; the cap on pensions; and the age of retirement.

But Mr Thompson held out little promise of major concessions as the BBC seeks to plug a £2bn pension deficit. “From an economic point of view there’s not much room for manoeuvre,” he said.

In a move designed to show that senior staff are suffering too, Mr Thompson said that he would review senior managers’ pension top-ups. These so-called furbs (funded unapproved retirement benefit schemes) were introduced in 1989 to bring new appointees’ pensions into line with those of previous appointees.

“We will review them,” he said. “My expectation is these payments will be changed and all those who get them will be moved on to the same pension arrangements as those we are now proposing.”

If they are scrapped, a total of £646,000 will be sacrificed by the BBC’s executive directors, 13.5 per cent of their total remuneration. About 30 further senior managers are also in line for the reduction.

Mr Thompson has already agreed to freeze his pay, give up a month’s salary this year and waive bonuses for six years. Withdrawing his furb would see his total remuneration fall by £163,000 to £675,000 this year.

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