London - Tesco has written to its 300 000 staff outlining plans for the future of the supermarket's pension scheme as it looks for ways to plug the estimated £5 billion black hole and official consultation starts.
In a letter sent to staff, seen by The Independent, Ruston Smith, the company's pensions director, wrote: “In January we announced our plans to consult on closing our existing pension scheme and replacing it with a new scheme... These proposed changes would allow us to continue to protect any pension you have already built up and allows us to continue to offer a competitive pension for colleagues in the future.
“We appreciate that this is a significant change, which is why we are committed to listening to your views before any changes are made.”
However, the shop-workers union, Usdaw, has told Tesco staff they will try to overturn the retailer's plans to scrap the defined benefit pension scheme and encourage bosses at the supermarket to look for other ways to save costs.
Usdaw's national officer, Pauline Foulkes, said: “We understand that everyone will be disappointed about the proposed changes to the defined benefit pension scheme. We will be seeking further details... including the business case and rationale for the proposed changes, what can be done to maintain a defined benefit pension scheme and for the defined contribution scheme Tesco is proposing to replace it with.”
It is still not yet known what Tesco plans to do, as the letters have not yet arrived at staff's homes, but with a multi-billion-pound writedown and the worst annual results ever for the supermarket being announced tomorrow, unions are preparing for the worst.
Dave Lewis, the chief executive, has already put in place radical changes to the running of the company, stripping out layers of management in head office and shop floors, and staff are said to be concerned at the future changes.
He outlined some plans to plug the pensions deficit earlier this year, including the sale of customer analysis business Dunnhumby and online music business Blinkbox.
Prices have been cut across stores and changes have been made to avoid a repeat of the accounting scandal that led to a £263m overstatement which is the subject of a Serious Fraud Office investigation.
The latest changes come as Britain's biggest supermarkets, including Tesco, face calls by consumer watchdog Which? for a competition inquiry into firms ripping off shoppers with misleading prices and special offers.
The organisation is making a “super-complaint” to the Competition and Markets Authority (CMA) pointing out that 40 percent of groceries are sold on promotion, with many being confusing.
Which? claimed that Asda increased the price of a Chicago Town Four-Cheese Pizza Two-Pack from £1.50 to £2 last year, then offered a “promotion” of two for £3. When the offer ended the price went back to £1.50.
It also said that Heston from Waitrose Acacia Honey & Ginger Hot Cross Buns were advertised at £1.50 for just 12 days before going on offer at “£1.12 was £1.50” for 26 days. Meanwhile, Tesco sold four cans of Green Giant Sweetcorn for £2 (from £2.44), but six cans were proportionately more expensive at £3.56, according to Which?, although the larger pack said “special value”.
The Independent