Barclays could save £200m by pausing payments to staff pension scheme

theguardian.com:

Barclays could save itself more than £200m a year after deciding to take a break from paying into its staff pension scheme, despite the fund’s assets plummeting by £10bn in 12 months.

Barclays last month declared profits of £7bn for 2022, but its “contribution holiday” means the cost of the payments it would normally make towards former employee’s retirement benefits will now have to be met by the pension scheme – prompting anger among some ex-staff.

One retired scheme member, who asked not to be named, claimed that the bank was able to afford to take a payment holiday because it was enjoying “huge savings” as a result of restricting annual pension increases for its 72,000 pensioners and dependants to a maximum of 5%, even though inflation was currently running at more than 10%, and it could opt to pay more.

The scheme member said: “Despite its assets reducing in value from £37.2bn in 2021 to just £27.2bn in 2022 after Liz Truss caused the fund’s value to bomb, Barclays is claiming it has a £2bn surplus and the pension fund can afford the pension contribution holiday that the bank is taking in 2023.”

He said the scheme’s pensioners “are primarily staff who worked in the branch network and at Barclaycard rather than the investment bankers of today. They retired on modest pensions that are being eroded by inflation … Barclays should play fair with these former staff.”

While scheme payouts increase each year in line with retail prices index inflation, this is capped at 5%, though a document seen by the Guardian states that Barclays has the discretion to award higher increases. It is understood that the bank is keeping arrangement this under review.

The scheme member said that while it appeared the bank was not prepared to do this