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Last Updated: Saturday, 6 January 2007, 00:29 GMT
BA closer on pension resolution
BA plane
BA said the proposal set out contributions that were affordable
British Airways is getting closer to an agreement with unions over plans to cut the 2.1bn pension deficit by more than half, after talks.

BA said it would make a one-off payment of some 800m to the pensions fund, for its 33,500 company pension holders.

The Transport and General Workers Union said more details would be given on Monday, giving members time for advice.

The proposed payments require staff to accept changes, including increasing the age of retirement to 65.

'Fundamental issue'

BA said the plan would make its ongoing contributions affordable.

"[It] effectively tackles one of the most fundamental issues we face," said BA's chief executive Willie Walsh.

The TGWU, which is BA's largest union with 20,000 members, said the proposal included different contribution levels.

The union said it would it would back changes that would ensure the carrier would contribute hundreds of millions of pounds for pensions.

Unions have been concerned about the erosion of their members' benefits.

The firm's scheme has more than 33,000 active members, 20,000 deferred members and 15,000 pensioners.

BA paid 235m into the fund in 2005 and has previously said that unless employee benefits were changed, payments would have to rise to 497m yearly.

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