London, England, United Kingdom (AHN) – Officials of British Airways’ pension fund rejected a return to the old method of computing increases in pensions. They said the air carrier is not in a financial position to revert to the use of retail price index as basis for computing their pension hike.

Paul Spencer, chairman of the Airways Pension Scheme, told about 1,000 angry pensioners on Monday in a meeting, that BA is a long way off from securing their pensions because if the carrier becomes insolvent, they would not even receive 100 percent of their due pensions.

The changes in the way the pension fund hike is computed is due to a recent British coalition government policy that linked public pension hikes to the consumer price index, which would is lower because it excludes housing costs.

The result of the shift would be BA would hike the pension by only 3.1 percent based on the current inflation rate, instead of 4.6 percent, which is the RPI.

Pensioners of the air carrier are affected by the government policy on public pensions because BA used to be government owned, until it was privatized about 25 years ago.

The APS used to add an additional 1.5 percent to the CPI rate to bring the pension hike to 4.6 percent, but in March six BA-appointed trustees opposed the hike. Eight out of 12 APS trustees’ votes are needed to award the discretionary increase to the pensioners.

Six independent trustees favored awarding the discretionary hike, but three resigned over the issue. One of the trustees who resigned, Cliff Pocock, debunked Spencer’s claim that BA is not in a financial position to revert to the use of RPI.

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