Thomson Reuters has turned its back on members of its UK pension funds and ruled out any inflation-linked increase for 2009, their fourth pay freeze in the past seven years.

The bad news, which effectively means that RPF and SPS pensioners are 13 per cent worse off, was confirmed at the Thomson Reuters annual general meeting in London on 13 May.

At the AGM, Pension Review Group (PRG) chair Angela Dean asked CEO Tom Glocer when the newly merged company would "do the right thing by its pensioners and pay them index-linked increases, as do other FTSE100 companies with defined benefit schemes, and as did the old Thomson company for its UK pensioners?"

Glocer ducked the question and passed it to former Reuters chairman Niall FitzGerald, who speaks for "legacy Reuters issues" on the new Thomson Reuters board of directors.

RPF/SPS in deficit FitzGerald noted that the RPF and SPS were in deficit at the end of 2008. This meant that under the terms of the 2006 funding agreement between old Reuters and the pension fund trustees, there could be no inflation increases this year.

FitzGerald reminded us there had been increases in the three years since the funding agreement, when Reuters put in £230 million to shore up the funds and wipe out their deficits at that time.

If the funds returned to surplus by the end of this year, the trustees would be in a position to resume increases, he said.

The funding agreement between RPF/SPS and the company runs out in 2010, when it will be renegotiated. When Thomsons took over Reuters last year, they said they were standing by the agreement.

Allan Ferguson, another Reuters UK pensioner who attended the AGM, said he understood that former employees of Thomsons "get cost of living increases automatically."

FitzGerald replied that Thomson Reuters had many pension schemes in many different countries. "Some have automatic indexation, some don’t. I really can’t add anything to what I said."

Serious consideration of concerns David Thomson, chairman of the board and head of the Canadian company which has the controlling interest in Thomson Reuters, ended on a more conciliatory note by saying, "We will take into serious consideration your concerns."

The PRG wrote to CEO Glocer in April, ahead of the AGM, setting out the concerns of RPF/SPS pensioners and asking the company to resume annual inflation increases, which was very much the custom and practice prior to the first freeze in 2003.

The PRG letter, which the company has acknowledged but not yet

provided a substantive reply, noted that Thomson Reuters was doing well and paying Glocer and other senior executives multi-million dollar salaries and bonuses.

Pensioners, meanwhile, were getting poorer. We shall publish the full text of the PRG letter and the company’s substantive reply, when it arrives. The question asked by the PRG chairman at the AGM was as follows:

Your comments

Newsletter archive September 2008 26 April 2008 3 April 2008 January 2008 June 2007 May 2007 April 2007 November 2006 August 2006 26 May 2006 3 May 2006 February 2006 December 2005 August 2005 July 2005 May 2005 February 2005 September 2004 August 2004