Cost of UK pensions rises

British Airways PLC
18 November 2003




COST OF UK PENSIONS RISES SHARPLY



The latest actuarial valuation, calculated every three years to determine the
funding position of British Airways' two main UK pension schemes - Airways
Pension Scheme (APS) and the New Airways Pension Scheme (NAPS) - has been
completed.



The actuary has calculated that the APS surplus (£820 million at the last
valuation in March 2000), has fallen to £45 million and the NAPS deficit has
risen from £221 million at March

2000 to £928 million at March 2003.  The government minimum funding requirement
(MFR) is covered in both schemes.



The actuary has determined that annual contributions of £26 million for APS are
required from November 2003.  For NAPS, contributions will increase by £107
million a year to £225 million effective January 2004.



John Rishton, British Airways' Chief Financial Officer, said:  'The deficit is
mainly due to the poor performance of stockmarkets in the last three years and
changes in life expectancy.



'British Airways remains committed to its existing pension schemes but these
funding increases are a substantial additional burden, particularly in the
current difficult trading environment.  We will be working with our unions and
staff to find a sensible solution.'



Both APS and NAPS are final salary schemes and are closed to new members.  The
airline introduced the British Airways Retirement Plan (BARP), a defined
contribution pension scheme, in April 2003 for new staff.



APS and NAPS together have combined assets of some £9 billion.  BA has had a
pension contribution holiday from APS but has contributed annually to NAPS since
it was set up.



                             ends



November 18, 2003                                             156/KG/2003



Notes to Editors



•         The actuarial valuation takes into account the company and employee
contributions, member profiles and demographics, likely investment returns from
the pension funds and the stock market performance and then calculates the
funding position.



•         APS was set up in 1948 and has 35,500 members of whom 3,500 are
serving staff, 26,800 pensioners in payment and 5,200 deferred pensioners.  It
closed in 1984. BA has had a contributions holiday from APS since 1989.



•         NAPS was set up in 1984 and has 65,000 members of whom 39,700 are
existing staff, fewer than13,000 are pensioners and about 17,600 deferred
pensioners.



•         BA has never had a contributions holiday for NAPS and currently pays
three times as much as each individual into the scheme.  So for every £1 paid in
by the employee, BA pays £3.



•         The Minimum Funding Requirement (MFR) is a Government measure that
determines the minimum level of contributions needed to fund a pension scheme.





Certain information included in this statement is forward-looking and involves
risks and uncertainties that could cause actual results to differ materially
from those expressed or implied by the forward looking statements.



Forward-looking statements include, without limitation, projections relating to
results of operations and financial conditions and the Company's plans and
objectives for future operations, including, without limitation, discussions of
the Company's 'Future Size and Shape' programme, expected future revenues,
financing plans and expected expenditures and divestments.  All forward-looking
statements in this report are based upon information known to the Company on the
date of this report.  The Company undertakes no obligation to publicly update or
revise any forward-looking statement, whether as a result of new information,
future events or otherwise.



It is not reasonably possible to itemise all of the many factors and specific
events that could cause the Company's forward looking statements to be incorrect
or that could otherwise have a material adverse effect on the future operations
or results of an airline operating in the global economy.  Information on some
factors which could result in material difference to the results is available in
the Company's SEC filings, including, without limitation the Company's Report on
Form 20-F for the year ended March 2002.




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