Concerns have been raised by engineers at British Gas after its parent company Centrica proposed cost-saving measures to their pension plan.
The proposed changes mean 7,000 engineers’ contributions would need to increase by 3 per cent of their salary and the “build-up”, or accrual, rate for their pension pot would reduce from 1/80th to 1/107th, resulting in a smaller pension upon retirement.
A one-off “transition payment” of £8,750 into their pension has been offered if they accept the changes, which would take effect next April.
Under the proposals, which are part of a wider efficiencies programme announced in February, staff would have the option to “flex” their contribution and accrual rates up or down, so a build-up rate of 1/107th would “unlikely” be the case for everyone.
According to reports in The Guardian one engineer said they expected the share price to increase if the changes go ahead, meaning share-holding executives would benefit.
They said: “What they’re displaying is a lack of empathy. They’ll be alright. We’re being taken for complete mugs.
“It’s harder to take when the people who are taking these changes forward will be financially rewarded if these changes go through.”
The proposals concern 11,000 employees in total and the consultation is expected to end with a ballot in January.
The consultation packs cite several reasons behind its cost-saving measures including increased market competition, wider economic market conditions and the energy price cap.
In response to the concerns a Centrica spokesperson said the company wanted a “long-term, attractive pensions deal” that is good for both customers and colleagues.
The spokesperson added: “The energy market is increasingly competitive and we are taking action across our whole business to respond to this.
“We are now consulting with trade unions and colleagues about proposals to reduce our pension costs to a level which allows us to be price competitive for our customers, while still providing the defined benefit pension option which we know is very important to our people.”