The oil giant Royal Dutch Shell is shutting off its final-salary pension scheme to all new UK employees from the start of next year.
From early 2013, the Anglo-Dutch company will instead offer new starters a pension scheme without any guaranteed level of pension. 
Existing members of the Shell final-salary scheme will be able to continue to contribute and build up their pensions. The fund currently makes pension payments to about 30,000 pensioners and has about 6,500 active employees as members.
The news follows as the Association of Consulting Actuaries (ACA) announced this week that companies across the UK have closed 90% of final-salary schemes to new members, as firms desperately try to cut costs.
Royal Dutch Shell is now the last of the FTSE 100 listed companies to close its final-salary scheme, which provides staff with a guaranteed pension based on their pay once they retire along with their length of service.
Len McCluskey, the general secretary of Unite, said: “This is a disgraceful act – nothing less than greed on the part of one of the world’s richest and most powerful corporations. They have no need whatsoever to close this scheme and in the process deny their employees the safe retirement they were promised they could save for.”
He added: “Shame on Shell, for where they lead, other corporations will follow.”
Shell will introduce a new defined contribution scheme where new members’ pensions will depend upon the success of investments.
“The plan will be designed to ensure that the reward package in the UK for new hires remains strongly competitive,” said a spokesman for Shell.
The company said that the initiative “reflected market trends” in the UK. However, it also said that unlike other companies, it would continue to uprate existing members’ pensions using the Retail Price Index (RPI) measure of inflation rather than the lesser Consumer Price Index (CPI).
“The company is proposing to develop a UK defined contribution pension plan for new hires to Shell to reflect market trends in the UK.
“Timing is proposed to be quarter one, 2013. The plan will be designed to ensure that the reward package in the UK for new hires remains strongly competitive.”
