Johnston Press Announces Plan to Scrap its Final Salary Pension Scheme

The publishers of The Scotsman newspaper has announced it intends to scrap its pension scheme whereby retired staff each year receive from the company a portion of their final year's salary, depending on their length of service.

If it goes ahead, it is estimated it will affect 15 per cent of the company's workforce, the company having stopped offering a final salary pension to new staff some years ago.

A two-month consultation period with members of staff and the National Union of Journalists begins on Monday

Should the closure go ahead, it will take effect from the end of June. 

In a memo to staff, chief executive, John Fry, writes: “In recent years, this type of pension plan has become ever more expensive and volatile for companies to continue to offer to employees….Since 2002, the shortfall in the funding of the plan has risen from £74 million to £146 million, despite the company making additional contributions of over £43 million on top of our 'regular' employer contributions in an attempt to help reduce the shortfall during this time. The company cannot continue to bear this level of financial risk.”

Johnston Press publishes 18 daily newspapers and 300 weekly ones.